I. Explain the following terms 1.inquiry 2.offer 3.counteroffer 4.acceptance II. Short questions 5.What are the four components of the standard form of a price? 6.While making pricing decision, what major factors should be considered? 7.What are the differences and similarities between commission and discount? 8.When will an offer be terminated? 9.What are the possible modifications a counteroffer may make to an offer? III. Case studies 10.Under the price of USD25.5/dozen CFR Rotterdam BB Company signed a contract to sell 1,000 dozens of T-shirt. The T-shirt was purchased from factory by RMB135/dozen. BB Company calculated 3% of its product purchasing price as its overhead costs. The local transport and customs formalities took RMB2,500 and the container ocean freight was USD1,500. If the bank exchange rate was 1USD/6. 5RMB, what would be the export profit margin for this deal? And what about its export cost for foreign exchange? 11.The price quoted by a Shanghai exporter was “USD1,200 per M/T CFR Liverpool”. The buyer requested a revised FOB price including 2% commission. The freight for Shanghai-Liverpool was USD200 per M/T. To keep the export revenue constant, what would FOBC2% price be? 12.AC Company offered to sell goods at “USD100 per case CIF New York”. The importer requested a revised quote for CFRC5%. The premium rate for insurance was 1.05% and mark-up for insurance was 10%. To get the same export revenue, what would AC’s new offer be? 13.DD Company offered to sell goods at “USD2,000 per M/T CIF Toronto with ‘all risks’ and ‘war risk’ for 110% of the value”. The importer requested a revised quote for FOB Guangzhou. The freight for Guangzhou-Toronto was USD50 per M/T, and the premium rates for “ all risks ” and “ war risk ” were 1% and 0.2% respectively. To get the same export revenue, what FOB price should the exporter offer? 14.The price quoted by an exporter was “USD450 per case FOB Shanghai' The importer requested a revised quote for CIF Auckland. If the freight was USD50 per case, 110% of the value was to be insured, and the premium rate for insurance was 0.8%, what would the new price be? 15.X Company signed a contract to export two machines at an initial price (P0) of USD5 million each. At the time of setting P0, the material price index (M0) was 110, the wage index (W0) was 120. The contract contained a price revision clause that allowed the final price to be set on delivery.At the time of delivery, the material price index (M) was 112, and the wage index (W) became 125. If the following ratios remained constant : A (the management fee and profit as a percentage of the price) = 15 %B (the material cost as a percentage of the price) =30%C (the wage cost as a percentage of the price) =55%What is the final price (P) ? 16.On Nov. 20th, Lee Co. offered to sell goods to Dee Inc. at USD500 per case CIF London, “Offer valid if reply here Nov 27.” On Nov, 22nd Dee cabled back, “Offer accepted if USD480 per case.” As Lee was considering the bid, the market price went over USD500. On Nov. 25th, Dee cabled an unconditional acceptance of Lee ’ s initial offer. Could Lee reject Dee ’ s acceptance? 17.X offered to sell goods to Y, “Shipment within 2 months after receipt of L/C, offer valid if reply here 5 days.” Two days later, Y cabled back, “Accept your offer shipment immediately,” X didn’t reply. Two more days later, X received Y’s L/C requiring immediate shipment. At this time, the market price of the goods went up by 20%. What options did X have to deal with Y?