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Which of the following investments is a negotiable time draft drawn to facilitate foreign trade by financing the export, import, domestic shipment, or storage of goods?

a. American Depository Registry
b. Bankers Acceptance
c. Certificate of Deposit
d. Collateralized Mortgage Obligation

1 Answer

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Final answer:

A bankers acceptance is the negotiable time draft in question, facilitating foreign trade by guaranteeing payment for goods via a bank's agreement to pay a specified sum in the future. The correct option is (b).

Step-by-step explanation:

The investment that is a negotiable time draft drawn to facilitate foreign trade by financing the export, import, domestic shipment, or storage of goods is a Bankers Acceptance.

A bankers acceptance is created as a result of a commercial transaction, particularly in international trade. It is an agreement by a bank to pay a sum of money at a future date, typically within six months at most. This financial instrument is used to guarantee payment for goods in both domestic and international transactions, acting as a sort of promissory note, backed by the bank.

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