Which ONE of the following most appropriately describes forfeiting?(A) It is a method of p

Which ONE of the following most appropriately describes forfeiting?

(A) It is a method of providing medium-term export finance

(B) It provides long-term finance to importers

(C) It provides equity finance for the redemption of shares

(D) It is the surrender of a share because of the failure to make a payment on a partly-paid share

Which of the following is not a method used for raising finance to fund export sales?

(A) Bills of exchange

(B) Credit insurance

(C) Documentary credits

(D) Countertrade

Which of the following would NOT be regarded as a source of short-term finance:

(A) Trade credit from suppliers

(B) Treasury bills

(C) Factoring of trade receivables

(D) Bank overdraft

List six sources of short-term investments.

In no more than 40 words, define the meaning of ‘yield to maturity’.

(A) Explain the main sources of short-term and medium-term funds. (8 marks)

(B) Discuss a situation where it is better to obtain overdraft facilities rather than a term loan. (6 marks)

(C) ‘Delaying payment to suppliers of goods and services is always a cheap form of borrowing funds.’ Discuss this statement.


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