A letter of credit is opened on behalf of a/an _____________.

Exporter

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Importer

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Buying agent

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Bank

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Solution

The correct option is B Importer
A letter of credit is opened on behalf of an importer. A letter of credit refers to a bank agreeing to accept and pay on due date. A letter of credit can be defined as a written commitment to pay the seller if the importer fails to make the payment to seller or exporter on time.

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