Final answer:
In FOB destination, the seller is responsible for the transportation costs and arranges and pays for the shipment of the goods to the buyer's specified destination.
Step-by-step explanation:
FOB Destination
FOB destination is a trade term used in business to determine who is responsible for transportation costs. In FOB destination, the seller is responsible for paying the transportation costs. This means that the seller will arrange and pay for the shipment of the goods to the buyer's specified destination. The buyer assumes ownership and responsibility for the goods once they are delivered to the specified destination.
For example, let's say a manufacturer in California sells a product to a retailer in New York. The manufacturer arranges and pays for the shipment of the goods from California to New York. The retailer becomes responsible for the goods once they are delivered to their store in New York.