Question
A ______ is a document from a bank guaranteeing that a
seller will receive payment in full as long as certain delivery conditions have been met.Solution
Letter of Credit is a written undertaking given by a bank (issuing bank) to the seller or exporter (beneficiary) on the instruction of the buyer or importer (applicant) to pay at sight or at a determinable future date up to a stated amount of money subject to the beneficiary’s satisfactory compliance of presentation of documents. It is also known as a documentary credit.
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