Final answer:
Free on board (FOB) is a term related to the delivery and transfer of goods, indicating when the responsibility and ownership of goods transfers from the seller to the buyer, typically at the point of origin or destination, not necessarily specifying the price nor exclusive to vessel shipments.
Step-by-step explanation:
Free on board (FOB) is a term used in international commercial law regarding the delivery and transfer of goods. Regarding the options provided:
- FOB does not mean that the buyer usually quotes a price for the goods; that is typically done by the seller.
- While FOB is commonly used for vessel shipments, it is not exclusive to them and can apply to other modes of transportation.
- FOB does not mean that the price is decided only upon delivery; the price is agreed upon before the shipment.
- FOB applies not only at a designated inland shipping point but also for sea shipments, often specifying the point at which the risk and ownership of goods is transferred from the seller to the buyer.
The term FOB is typically followed by a location name, which indicates who has responsibility for the goods at which point during shipment. In FOB origin, the buyer takes responsibility once the goods are shipped, and in FOB destination, the responsibility transfers when the goods arrive at the destination.