Which of the following attributes of a bankers' acceptance greatly enhances its marketability?
A)the authenticity of an accepted draft is separated from the underlying commercial transaction
B)the accepted draft may not be dishonored for reason of a dispute between the exporter and importer
C)the accepted draft is automatically guaranteed by the Eximbank
D)both a and b

Question

Quizplus · Accepted Answer

Both attributes mentioned in options A and B greatly enhance the marketability of a bankers' acceptance. The fact that the authenticity of an accepted draft is unrelated to the commercial transaction reduces the risks of default, and the fact that the draft cannot be dishonored due to disputes between the parties involved adds to its liquidity. On the other hand, option C is incorrect as a bankers' acceptance is not automatically guaranteed by the Eximbank.

Which of the Following Attributes of a Bankers' Acceptance Greatly