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EXIM Finance MCQ Set 2

Review each question and reveal answers to strengthen your understanding

1 The advance remittance against imports is subject to the conditions
✅ Correct Answer: 4
2 . Import license are required
✅ Correct Answer: 3
3 A bank opening a letter credit gets charge over the imported goods till payment is made by the importer under the provisions of
✅ Correct Answer: 1
4 The maximum period of credit fixed by RBI depends on
✅ Correct Answer: 4
5 For deferred payment import remission should be sought from the Reserve Bank when
✅ Correct Answer: 3
6 Standby letters of credit can be used by authorized dealers in India for
✅ Correct Answer: 2
7 An exporter cannot obtain details about prospective buyers from
✅ Correct Answer: 4
8 Under advance remittance as a method of payment the credit risk is borne by
✅ Correct Answer: 1
9 Open account was used as a method of payment indicates
✅ Correct Answer: 4
10 Open account method of payment is beneficial to
✅ Correct Answer: 1
11 Cash on delivery method is normally used for
✅ Correct Answer: 3
12 Documents against payment term indicates
✅ Correct Answer: 3
13 The best form of method of payment for an importer would be
✅ Correct Answer: 1
14 When goods are sent to an agent of an exporter in the importing country, the method of payment adopted is
✅ Correct Answer: 3
15 The method of payment where the exporter relies on the undertaking of a bank to pay is.
✅ Correct Answer: 2
16 Letter of credit transactions are generally governed by the provisions of
✅ Correct Answer: 3
17 The beneficiary under a letter of credit is
✅ Correct Answer: 4
18 A letter of credit is opened on behalf of
✅ Correct Answer: 2
19 A letter of credit is addressed to
✅ Correct Answer: 1
20 A letter of credit that provides for granting of pre-shipment finance as well as storage of goods in the name of the bank is
✅ Correct Answer: 3
21 When a letter of credit does not indicate whether it is revocable or irrevocable, it is treated as
✅ Correct Answer: 2
22 Payment for bills drawn under letter of credit should be made by the negotiating bank
✅ Correct Answer: 2
23 Under an acceptance letter of credit, the responsibility of the issuing bank is
✅ Correct Answer: 3
24 Which of the following organisation does not specialize in training activity?
✅ Correct Answer: 3
25 Under the confirmed letter of credit the undertaking the confirming bank is
✅ Correct Answer: 1
26 A credit which provides for reinstatement of the amount as and when bills are drawn under it is called
✅ Correct Answer: 3
27 Working Group for approval of project exports does not include
✅ Correct Answer: 4
28 For project exports fulfilling norms for period of credit, in principle sanction can be given by
✅ Correct Answer: 3
29 The following statement with respect to moratorium on repayment of principal on project export is not correct
✅ Correct Answer: 3
30 Export of services on deferred payment terms requires clearance of the Working Group for
✅ Correct Answer: 4
31 In case of failure of the exporter, the liability of the bank which has issued the performance guarantee is to
✅ Correct Answer: 4
32 Advance payment guarantee assures
✅ Correct Answer: 3
33 Indian parties are prohibited from making investment in a foreign entity engaged in the business of
✅ Correct Answer: 2
34 Direct investment in a joint venture abroad can be made by an Indian party with ceiling on limit under automatic route if the investment is made from
✅ Correct Answer: 3
35 Which of the following is not an approved method of funding direct investment in a foreign joint venture?
✅ Correct Answer: 2
36 An Indian entity which has made direct investment abroad is not required to
✅ Correct Answer: 3
37 . Export Credit Guarantee Corporation(ECGC) policies do not cover risk against A. buyer’s protracted default to pay for the goods. B. war in buyer’s country. C. buyer’s failure to obtain necessary import licence or exchange authorization from authorities in his country. D. cancellation of export licence.
✅ Correct Answer: 3
38 The standard policy of ECGC protects loss to the extent of
✅ Correct Answer: 2
39 The maximum amount of claim against an individual buyer that ECGC will accept under its standard policy issued to an exporter is known as
✅ Correct Answer: 2
40 The standard policy of ECGC is issued
✅ Correct Answer: 1
41 Unless prohibited by letter of credit, a bank can accept
✅ Correct Answer: 4
42 A red clause letter of credit is also known as
✅ Correct Answer: 2
43 Guarantee credit is another name for
✅ Correct Answer: 3
44 Amendment to a letter of credit should be advised through the
✅ Correct Answer: 4
45 19 A guarantee issued by a bank in lieu of bid money to be deposited by the exporter to participate in the tender is a
✅ Correct Answer: 1
46 A guarantee issued in favour of an importer so that he releases entire contract amount instead of retaining a portion is
✅ Correct Answer: 2
47 A guarantee issued in favour of an importer so that he releases entire contract amount instead of retaining a portion is
✅ Correct Answer: 2
48 For export guarantees issued a bank may obtain cover from ECGC under its
✅ Correct Answer: 1
49 The statutory basis for regulation of foreign trade in India is
✅ Correct Answer: 1
50 Two parties agreeing to buy and sell from each other without involving payment is known as
✅ Correct Answer: 3
51 . Banks can permit a reduction in the value of export bills up to
✅ Correct Answer: 4
52 . Banks can permit a reduction in the value of export bills up to
✅ Correct Answer: 4
53 The undrawn balance on export bills are permitted up to
✅ Correct Answer: 1
54 For imports from Pakistan, payment should be made in
✅ Correct Answer: 1
55 The time limit for export realization
✅ Correct Answer: 4
56 Comprehensive risk policy covers
✅ Correct Answer: 3
57 21 Export turnover policy is for
✅ Correct Answer: 1
58 Which one of the following statements relating to Consultancy and Technology Services Finance Programme of Exim Bank is Wrong?
✅ Correct Answer: 3
59 For Export Oriented Units, Exim Bank finances
✅ Correct Answer: 3
60 Which one of the following is not a common feature of direct lending by Exim Bank?
✅ Correct Answer: 3
61 For availing discounting of bills with forfeiter, the exporter should produce
✅ Correct Answer: 1
62 Which of the following is not a basic objective of documentation in foreign trade?
✅ Correct Answer: 4
63 Which of the following is not an important document in foreign trade?
✅ Correct Answer: 1
64 _ risk is the potential exchange loss from outstanding obligations as a result of exchange-rate fluctuations.
✅ Correct Answer: 3
65 Foreign exchange risk can be reduced by using _____.
✅ Correct Answer: 4
66 Which of the following is not a condition for drafts to be negotiable?
✅ Correct Answer: 2
67 If a draft is made to bearer, payment should be made to _____.
✅ Correct Answer: 4
68 If a draft is accepted by a bank, it becomes a _____.
✅ Correct Answer: 4
69 If a draft is accepted by a bank, it becomes a _____.
✅ Correct Answer: 4
70 If a draft is accepted by a bank, it becomes a _____.
✅ Correct Answer: 4
71 Forms of countertrade include the following except ___.
✅ Correct Answer: 3
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