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WAEC Commerce 2004 Question 19

Question 19

Foreign Trade

The most acceptable means of payment in foreign transaction is

  1. A.personal cheques
  2. B.central bank cheques
  3. C.irrevocable letters of credit
  4. D.bankdrafts
Show the answer and explanation

Answer: C (irrevocable letters of credit)

Explanation

An irrevocable letter of credit guarantees payment to the exporter.