Title: Explain methods of payment for international transactions.
Course: Opportunities in Global Trade, Advanced (12056-II) > Section: Analyzing Pricing and Payments in the International Marketing Plan

Explanation should include

- open account
- documentary collection
- letter of credit
- cash in advance.

Process/Skill Questions:

- What are the risks to the seller (exporter) and the buyer (importer) when using each method of payment?
- When is the payment made: before shipping or after shipping? Explain.
- Which methods of payment are most secure? Least secure?
- What method of payment is the most beneficial for the importer?
- When is the method of payment agreed upon in the sales transaction?
- Why are letters of credit used to limit international purchasing risk?
- What are revocable letters of credit? What are irrevocable letters of credit?