Import/Export Test Flashcards
What is The Importance of Importing
Consumer demand for products unique to foreign countries, Lower costs of foreign-made products, Sources of parts needed for domestic manufacturing
4 Importing Activities
Determine Demand, Contact Suppliers, Finalize Purchase, Receive Goods
Customs Official
is a government employee authorized to collect duties levied on imports
The Exporting Process
Find potential customers, Meet the needs of customers, Agree on sales terms, Deliver products or Services, Complete the Transaction
Indirect Exporting
occurs when a company sells its products in a foreign market without actively seeking out those opportunities
Direct Exporting
conducts business by actively seeking export opportunities
Free on Board (FOB)
means the selling price of the product includes the cost of loading the exported goods onto transport vessels at the specified place
Cost, Insurance, Freight (CIF)
means that the cost of the goods, insurance, and freight are included in the price quoted
Cost and Freight (C&F)
indicates that the price includes the cost of the goods and freight, but the buyer must pay for insurance separately
Freight Forwarder
a company that arranges to ship goods to customers
Trade Surplus
Occurs when a country exports more than it imports
Trade Deficit
Occurs when a country imports more than it exports
Balance of Payments
total flow of money coming into a country minus the total flow going out
Direct Barter
The exchange of goods and services between two parties with no money involved
Countertrade
is the exchange of products or services between companies in different countries with the possibility of some currency exchange
Money
is anything people will accept for the exchange of goods and services
Barter
The direct exchange of goods and services for other goods and services
Interest rate
The cost of using someone else’s money. Higher interest rates mean more expensive products and lower demand among consumers
5 Main Characteristics of Money
Acceptability, Scarcity, Durability, Divisibility, Portanbility
3 Main Purposes of Money
Medium Exchange, Measure of Value, Store of Value
Medium Exchange
Money is useful only if people are willing to accept it in exchange for goods and services
Foreign Exchange
The process of converting the currency of one country into the currency of another country
Exchange Rate
is the amount of currency of one country that can be traded for one unit of the currency of another country
3 Factors of Forex
Balance of Payments, Economic Conditions, Political Stability
