Ch. 13- Vocab.

Question 1

Export/import financing in which an importer pays an exporter for merchandise before it is shipped

Answer 1

Advance Payment

Question 2

Individuals or organizations that represent one or more indirect exporters in a target market

Answer 2

Agents

Question 3

Exchange of goods or services directly for other goods and services without the use of money

Answer 3

Barter

Question 4

Contract between an exporter and a shipper that specifies merchandise destination and shipping costs

Answer 4

4. Bill of Lading

Question 5

Export of industrial equipment in return for products produced by that equipment

Answer 5

Buyback

Question 6

Sale of goods or services to a country by a company that promises to make a future purchase of a specific product from the country

Answer 6

Counterpurchase

Question 7

Practice of selling goods or services that are paid for, in whole or in part, with other goods or services

Answer 7

Countertrade

Question 8

Practice by which companies use licensing agreements to exchange intangible property with one another

Answer 8

Cross Licensing

Question 9

Practice by which a company sells its products directly to buyers in a target market

Answer 9

Direct Exporting

Question 10

Export/import financing in which a bank acts as an intermediary without accepting financial risk

Answer 10

Documentary Collection

Question 11

Document ordering an importer to pay an exporter a specified sum of money at a specified time

Answer 11

Draft (Bill of Exchange)

Question 12

Institutional arrangement by which a firm gets its products, technologies, human skills, or other resources into a market

Answer 12

Entry Mode

Question 13

Company that exports products on behalf of indirect exporters

Answer 13

Export Management Company (EMC)

Question 14

Company that provides services to indirect exporters in addition to activities related directly to clients’ exporting activities

Answer 14

Export Trading Company (ETC)

Question 15

Practice by which one company (the franchiser) supplies another (the franchisee) with intangible property and other assistance over an extended period

Answer 15

Franchising

Question 16

Specialist in export-related activities such as customs clearing, tariff schedules, and shipping and insurance fees

Answer 16

Freight Forwarder

Question 17

Practice by which a company sells its products to intermediaries who then resell to buyers in a target market

Answer 17

Indirect Exporting

Question 18

Separate company that is created and jointly owned by two or more independent entities to achieve a common business objective

Answer 18

Joint Venture

Question 19

Export/import financing in which the importer’s bank issues a letter pledging to pay the exporter when the exporter fulfills the terms listed in the letter

Answer 19

Letter of Credit

Question 20

Practice by which one company owning intangible property (the licensor) grants another firm (the licensee) the right to the use that property for a specified period of time

Answer 20

Licensing

Question 21

Practice by which one company supplies another with managerial expertise for a specific period of time

Answer 21

Management Contract

Question 22

Agreement that a company will offset a hard-currency sale to a nation by making a hard-currency purchase of an unspecified product from that nation in the future

Answer 22

Offset

Question 23

Export/import financing in which an exporter ships merchandise and later bills the importer for its value

Answer 23

Open Account

Question 24

Relationship whereby two or more entities cooperate (but do not form a separate company) to achieve the strategic goals of each

Answer 24

Strategic Alliance

Question 25

Practice in which one company sells to another its obligation to make a purchase in a given country

Answer 25

Switch Trading

Question 26

Practice by which one company designs, constructs, and tests a production facility for a client firm

Answer 26

Turnkey (build-operate-transfer) Project

Question 27

Facility entirely owned and controlled by a single parent company

Answer 27

Wholly Owned Subsidiary