Chapter six

1.      There are three main changes that are found during the evolution of international trade payments and settlements. What are they? (P148 Line 8-12)

2.      Credit instruments most commonly used in international trade payments and settlements are ____(bills of exchange), ____(promissory notes) and ____(checks). They are known as ____(negotiable) instruments.

3.      Immediate parties refer to the  ____(drawer), ____(drawee) and ____(payee). ____(A drawer) is the person who draws a bill of exchange or a check upon the drawee for the payment of certain amount of money. ____(A drawee) is the person upon whom a bill of exchange or a check is drawn. ____(A payee) is the person to whom the money is to be paid or to whose order the drawee is to make payment.

4.      According to the ____(drawer), bill of exchange is divided into  __and__(banker’s draft and trade bill).

5.      According to the ____(tenor), bill of exchange is divided into _and___(sight bill and time/usance bill)

6.      Which type of checks can be paid cash to the payee or holder? Open check or crossed checks? (open check. Because a crossed check must be presented for payment by a collecting bank.)

7.      There are three types of methods of settlement for international trade. What are they? (remittance, collection letter of credit)

8.      Which of the following does not belong to methods of settlement? T/T, M/T,D/D,D/P,D/A,L/C? (none)

9.      Which of the following does not belong to instruments used in settlement? remittance, collection, letter of credit?(none)

10.   What are the features of SWIFT?(safety, high speed, low expense, automation)

11.   What is SWIFT?( It shorts for society for worldwide inter-bank financial telecommunication.)

12.   Remittance is incidentally used for  ____(small percent) of the contract, and commonly used to pay ____(commissions, advertisements and miscellaneous expenses)

13.   Which of the following belongs to bank credit? Remittance, collection and L/C? (Letter of credit)

14.   Remittance and collection are settlement means on  ____(commercial) credit.

15.   Why we need an L/C? (L/C may minimize in foreign trade the risks of defaults that take place in remittance and collection)

16.   Is the L/C hasn’t stipulated, what is the maximum date of presentation date after loading on board? (21days)

17.   Among the following types of L/C, which is most commonly used? Sight payment credit, deferred payment credit  and usance credit?(SIGHT PAYMENT CREDIT)

18.   There are four procedures in the process of international trade negotiation. They are ____(enquiry, offer, counter offer and acceptance.) (P229)

Chapter five

1.      What is the definition of “insurance”? (P112 paragraph one)

2.      What is the definition of “Subject matter of insurance”? (P113  5.1.1 paragraph one)

3.      What is the definition of “An insurable interest”? (P113  5.1.1 paragraph two)

4.      An insurance contract is  ____(null and void) if the applicant has no insurable interest in the subject matter of insurance.

5.      What is the insurer’s and the applicant’s obligation under the principle of utmost good faith? (P114 倒数第二自然段)

6.      What is warranty? What is express warranty and what is implied warranty? (P115倒数第二自然段)

7.      In the event that the loss is caused by several causes and some are within the scope of insurance coverage but some are beyond, then the insurer should try to find out the ____(dominant) one. If the dominant one is covered, then the insurer should pay the claim, if not covered, then no payment.

8.      What is sea peril? And What does it include? (P118  5.2.1.1.)

9.      What is extraneous risk? And what does it include? (P119   5.2.1.2)

10.   Extraneous are not covered by a cargo ____(W.A.) or ____(F.P.A.)policy. An ____(All risks) policy includes extraneous risks.

11.   The definition of actual total loss and constructive total loss? (P 119)

12.   The definition of G.A. and P.A.?(P120)

13.   The distinction between G.A. and P.A.(P120 倒数line 4-8)

14.   Ocean marine cargo insurance is classified into the following three conditions--____(free from particular average) ____(with average) and ____(all risks)

15.   Aside from the risks covered under F.P.A condition as above, ____(W.A.) also covers partial losses of the insured goods caused by natural calamities.

16.   All risks= W.A.+_______(general additional risks)

Institute Cargo Clauses	Equivalence
A	All Risks
B	W.A
C	F.P.A (more narrow)

17.   The procedures to obtain an insurance policy:_____(to determine insurance amount)-à _____(to make an application)-à_____(to pay insurance premium)-à_____(to obtain an insurance policy)