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Questions - CSDG Text Chapter 01

The document consists of a quiz on Chapter 01 regarding demand guarantees and standby letters of credit, facilitated by K. M. Lutfor Rahman. It includes multiple-choice questions covering various aspects of guarantees, such as risks, categories, and legal defenses. Each question is followed by the correct answer, providing a concise overview of the key concepts related to demand guarantees.

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119 views11 pages

Questions - CSDG Text Chapter 01

The document consists of a quiz on Chapter 01 regarding demand guarantees and standby letters of credit, facilitated by K. M. Lutfor Rahman. It includes multiple-choice questions covering various aspects of guarantees, such as risks, categories, and legal defenses. Each question is followed by the correct answer, providing a concise overview of the key concepts related to demand guarantees.

Uploaded by

sukdeb.cdcs
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Questions on Chapter 01

(The uses of demand guarantees and standby


letters of credit)

FACILITATOR:
K. M. LUTFOR RAHMAN CDCS, CSDG, CTFP, CAMS-RM, CGSS

a K. M. Lutfor Rahman presentation


Quiz 01

Which of the followings risks are covered by a demand guarantee?

1. Risk of non-performance by the applicant.


2. Risk of non-payment by the beneficiary.
3. Risk of non-payment by the applicant.
4. Risk of non-performance by the beneficiary.

A. 1 and 3
B. 2 and 4
C. 1 and 4
D. 2 and 3

Ans: A
a K. M. Lutfor Rahman presentation
Quiz 02

Which of the followings are the two major categories of guarantees?

1. Performance
2. Financial
3. Tender
4. Payment

A. 1 and 3
B. 2 and 4
C. 1 and 4
D. 2 and 3

Ans: C
a K. M. Lutfor Rahman presentation
Quiz 03

Which of the following guarantees may cover both payment


and performance obligation?

A. Advance payment guarantee


B. Tender guarantee
C. Warranty guarantee
D. Parent company guarantee

Ans: D
a K. M. Lutfor Rahman presentation
Quiz 04

Which of the following guarantees may be established without any underlying


contract?

1. Performance
2. Customs
3. Tender
4. Payment

A. 1 and 3
B. 2 and 4
C. 1 and 4
D. 2 and 3

Ans: D
a K. M. Lutfor Rahman presentation
Quiz 05

Which of the following guarantees offers several legal


defences to a guarantor?

A. Bank guarantee
B. Demand guarantee
C. Suretyship guarantee
D. First demand guarantee

Ans: C
a K. M. Lutfor Rahman presentation
Quiz 06

A bond is a ___

A. Demand guarantee
B. Suretyship guarantee
C. Either a demand guarantee or Suretyship guarantee
D. None

Ans: C
a K. M. Lutfor Rahman presentation
Quiz 07

Party A gives the instructions to the bank to issue a guarantee or standby


letter of credit on behalf of Party B. Which of the following statements is
correct?

1. As per URDsG758: B is the applicant.


2. As per ISP98: A & B is the applicant.
3. As per UCP600: B is the applicant.

A. 1 and 2
B. 2 and 3
C. 1 and 3
D. All
Ans: A
a K. M. Lutfor Rahman presentation
Quiz 08

Which of the followings may invite an exception to the


independence to a demand guarantee?

A. Set-off between applicant and beneficiary


B. Commercial dispute
C. Bankruptcy of the applicant
D. Fraud exception

Ans: D

a K. M. Lutfor Rahman presentation


Quiz 09

Which of the following statements is correct?

A. The guarantor has an automatic right to reimbursement by the


counter-guarantor.
B. If the guarantor defaults, the beneficiary of the demand guarantee has
the right to present a demand directly to the counter-guarantor.
C. A counter-guarantee and a demand guarantee must have same terms.
D. Demand guarantees with no rules are more likely to give rise to
disputes than demand guarantees incorporating appropriate rules.

Ans: D

a K. M. Lutfor Rahman presentation


e

THE oEND

a K. M. Lutfor Rahman presentation

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