Assume a letter of contract is in place.If the importer does not pay the bank,then under the letter of contract the _______ is still obligated to pay the exporter.
A) Domestic government
B) Foreign government
C) Importer
D) Bank

Question

Quizplus · Accepted Answer

Under a letter of credit, if the importer does not pay the bank, the bank is still obligated to pay the exporter. This is because the letter of credit is a financial instrument issued by the bank that guarantees the exporter will be paid, provided that the terms and conditions of the letter of credit are met.

Assume a Letter of Contract Is in Place