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Question : Which of the following is not a type of financial instrument used in international trade?

Option 1: Letters of credit

Option 2: Bills of exchange

Option 3: Credit default swaps

Option 4: Bank guarantees


Team Careers360 4th Jan, 2024
Answer (1)
Team Careers360 11th Jan, 2024

Correct Answer: Credit default swaps


Solution : The correct answer is (c) Credit default swaps

Credit default swaps (CDS) are not typically considered a financial instrument used in international trade. CDS are financial derivatives that allow investors to protect themselves against the risk of default on debt obligations. They are primarily used in financial markets for hedging and speculation purposes, rather than in the context of international trade.

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