A firm concludes a counterpurchase agreement with a foreign country fo

QUESTION

A firm concludes a counterpurchase agreement with a foreign country for which it receives some counterpurchase credits for purchasing its goods.

The firm does not want any foreign goods, however, so it sells the credits to a third-party trading house at a discount. The trading house finds a firm that can use the credits and sells them at a profit. This is an example of:

A. barter.

B. switch trading.

C. an offset.

D. a buyback.

E. compensation.

ANSWER

B