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NEW QUESTION 28
Fruity McFruitFace is an exporter of fruit. Which of the following payment terms would be most advantageous for it?

A. advance paymentB. documentary creditsC. documentary collectionD. open account

Answer: A

Explanation:
Exporters prefer advance payment - this puts the risk with the importer / buyer. There's a table of these four terms on p.36. An importer would prefer an open account arrangements. The other two options are in the middle and the risk is more equally split between the two parties.

 

NEW QUESTION 29
Which of the following will you put into box 5?

A. ArbitrationB. MediationC. NegotiationD. Litigation

Answer: C

Explanation:
The correct answers are as follows:

This is negotiation - no third party is mentioned and there is a face-to-face meeting in private

 

NEW QUESTION 30
Mark is a consultant who works with building managers and advises them on how to make their buildings safer. What type of insurance should Mark have?

A. Professional IndemnityB. Property InsuranceC. Product LiabilityD. Public Liability

Answer: A

Explanation:
Mark needs professional indemnity insurance. Types of insurance is a known exam topic and the study guide does not cover this particularly well. Types of insurance is mentioned on p.25 but Pro-fessional Indemnity Insurance isn't really explained and this does come up in the exam. Professional Indemnity Insurance is needed when your job is to give advice to people (like as a Consultant). It's used for if the advice you give turns out to be bad. For example, if Mark told the building manager he should get ABC Fire Alarm installed, and actually this Fire Alarm doesn't meet the necessary Health and Safety standards, he could get sued by the building manager. He could then claim on his Professional Indemnity Insurance.

 

NEW QUESTION 31
Which of the following will you put into box 6?

A. Contract variationB. payment termsC. liquidated damagesD. liability

Answer: C

Explanation:
The correct answers are as follows:

The answer is liquidated damages as they're seeking compensation for loss.

 

NEW QUESTION 32
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