Chapter 06,07,09PDF.pdf - Testbank Instructors Name...

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Testbank 6-1 Instructor’s Name: Ming -Hsiang Chen Class Number: 91301 Course: 99211 International Trade Practice (E) Department: 911 International Business and Trade Program Test Bank Chapter 6: Terms of Trade or Incoterms® Rules TRUE/FALSE 1. Under the Free Carrier Incoterms ® Rule, the exporter is responsible for clearing the merchandise for export. 2. Under the FOB Incoterms ® Rule, in countries where export authorities require a pre-shipment inspection, the importer must pay for it. 3. The CFR Incoterms ® Rule means “Cost and Freight.” 4. The Cost, Insurance, and Freight Incoterms ® Rule is specifically designed for ocean transportation. 5. The Incoterms ® Rule CPT means “Cargo Placed at Terminal.” 6. A bill of lading or equivalent document (air waybill, sea waybill, multi-modal bill of lading) acts as proof of delivery under the CIP Incoterms ® Rule. 7. The EXW Incoterms ® Rule is mostly used for bulk shipments of commodities where the parties wish to have the exporter pay for the loading of the ship. 8. Under Incoterms ® Rule FAS, the importer is the party responsible for loading the goods onto the carrier. 9. Under Incoterms ® Rule FOB, transfer of responsibility for cargo from importer to exporter is at the ship’s rail as the cargo is loaded onto the ship 10. The DAP Incoterms ® Rule means “Deliver A t Port .” 11. Under the DAT Incoterms ® Rule, the exporter is responsible for the costs of transportation to the goods’ final destination and for the costs of clearing customs. 12. Under the FCA Incoterms ® Rule, it is the responsibility of the importer to arrange and pay for the loading of the goods. 13. Under the DDP Incoterms ® Rule, the importer takes control of the goods in the city where the exporter is located. 14. In planning their export strategy, companies generally determine which Incoterms ® Rule they will use on a case-by-case basis.
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