Vocab

CIF (cost, insurance, freight): where the seller is responsile for all expenses of delivery, including insurance premiums
clerical staff: the personnel dealing with office work such as filing, typing, and billing
to default: to fail to pay your debts
delivered at the frontier: delivery where the seller's obligations are met when the goods arrive at the frontier/border. the buyer must get the goods through customs and arrange to get them delivered to their door
delivery duty paid: delivery where the seller must deliver to the buyer's door and pay all of the duties
discount/to discount: a reduction in price
FOB (Free on board): free on board, where the buyer pays all costs from the moment the goods across over the ship's rail
irrevocable documentary credit: a means of payment where money is placed with a third party, a bank, and is transferred to the seller upon delivery of the goods. irrevocable means that this arrangement cannot be changed or canceled
nationls: citizens of the country in question
to penetrate: to enter a new market
subsidiary: a company in which more than half of the share capital is owned by another company

1. For an importer, shipping costs paid ___ are cheaper than paid ___.
2. ___ means to fail to pay one's debts. If Acme is afriad of this, they ask for ___ ___ ___.
3. Acme wants to use Nigeria ___ ___ the East African market.
4. The Nigerians want Acme to hire Nigerian __ and to open a ___.
5. If the Nigerians purchase a large number of pumps, they will probably get a ___.

Please type your subject in the School Subject box. Any other words are likely to delay responses from a teacher who knows that subject well.

1. For an importer, shipping costs paid FOB (Free on board) are cheaper than paid CIF (cost, insurance, freight). To determine this, you need to know the difference between FOB and CIF terms. FOB means that the buyer pays for all costs and assumes responsibility for the goods once they cross over the ship's rail. CIF, on the other hand, means that the seller is responsible for all expenses of delivery, including insurance premiums. Therefore, if the importer chooses FOB terms, they will only have to pay for the shipping costs from the ship's rail, which can be cheaper compared to CIF where the seller covers all the expenses.

2. "To default" means to fail to pay one's debts. If Acme is afraid of this, they ask for an irrevocable documentary credit. To understand this, you need to know what an irrevocable documentary credit is. It is a means of payment in which money is placed with a third party, usually a bank, and is transferred to the seller upon delivery of the goods. The term "irrevocable" means that this arrangement cannot be changed or canceled. By requesting an irrevocable documentary credit, Acme ensures that the payment is secured and that the seller will receive their payment even if Acme defaults on their debts.

3. Acme wants to use Nigeria to penetrate the East African market. To understand this, you need to know the meaning of "to penetrate" in a business context. "To penetrate" means to enter a new market or gain a foothold in a market that is new or challenging. Acme wants to leverage Nigeria as a gateway to enter and establish their presence in the East African market. By using Nigeria as a base, Acme can benefit from its strategic location and potentially expand its business operations further into the East African region.

4. The Nigerians want Acme to hire Nigerian nationals and to open a subsidiary. To understand this, you need to know the meaning of "Nigerian nationals" and "subsidiary" in a business context. "Nigerian nationals" refers to citizens of Nigeria. The Nigerians want Acme to hire local employees, specifically Nigerian nationals, to show their commitment to the local economy and create job opportunities. "Subsidiary" refers to a company in which more than half of the share capital is owned by another company. The Nigerians want Acme to establish a subsidiary in Nigeria, indicating that they expect Acme to have a physical presence and invest in the local market.

5. If the Nigerians purchase a large number of pumps, they will probably get a discount. To understand this, you need to know the meaning of "discount." A discount refers to a reduction in price. If the Nigerians purchase a large quantity of pumps, they are likely to negotiate a discounted price. The seller, in this case, may offer a price reduction to incentivize the bulk purchase and ensure a mutually beneficial business arrangement.