Question

22) A banker's acceptance is A) a liability of the importer and the importer's hank B) for greater than one year maturity. C) a method to help importers evaluate the creditwon D) an add-on instrument. E) a time draft drawn on the exporter's bank evaluate the creditworthiness of exporters.

Answer 1

IF ANY QUERY, FEEL FREE TO ASK Solution Banker Acceptance is an acceptance by bank to pay to the holder (Exporter or seller of goods) a particular amount on a future date as per acceptance. Banker aceptance are usually upto 90 days but may extend upto 180 days. It is Liability of Bank which accept it. It is a time draft instument drawn on the exporter's bank so as to ensure convenience of realisation by exporter. Hence, on the basis of above discussion option E) a time draft drawn on the exporter's bank is correct. Note : We are allowed to answer only one question, Kindly put other question in separate post.