Credit instrument - SS2 Commerce Past Questions and Answers - page 1
What is the purpose of a letter of credit?
Guaranteeing payment to the buyer
Guaranteeing payment to the seller
Guaranteeing payment to the issuing bank
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Who is the payee in a promissory note?
The maker
The drawee
The beneficiary
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What is the primary function of a bill of exchange?
Issuing loans to corporations
Guaranteeing payments in international trade
Facilitating electronic transactions
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What is the main characteristic of debentures?
They represent ownership in a company
They have a fixed maturity date
They are physical paper documents
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How are vouchers commonly used?
To guarantee loan repayments
To track financial transactions
To issue shares in a company
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Define a promissory note in simple terms.
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What is the purpose of a letter of credit in international trade?
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