Which of the following statements is true regarding price quotations for international sales?

• A. Price quotations for international sales are always given in the buyer's local currency.
• B. Price quotations must specify the currency and terms of delivery to avoid misunderstandings.
• C. Price quotations for international sales are typically less detailed than domestic quotations.
• D. International price quotations do not need to include information about shipping or insurance.

Answer: (B)

Verified step by step guidance

1. Step 1: Understand the context of international price quotations. In international trade, price quotations are formal offers that specify the price at which a seller is willing to sell goods to a buyer in another country.
2. Step 2: Recognize the importance of specifying the currency in international price quotations. Since buyers and sellers operate in different countries, the currency used must be clearly stated to avoid confusion over the amount payable.
3. Step 3: Understand the significance of including terms of delivery in the quotation. Terms of delivery (such as Incoterms) clarify who is responsible for shipping, insurance, and other logistics, which is crucial in international transactions.
4. Step 4: Evaluate the incorrect statements: Price quotations are not always given in the buyer's local currency; they can be in any agreed currency. Also, international quotations tend to be more detailed, not less, because of the complexities involved. Lastly, shipping and insurance details are essential and must be included.
5. Step 5: Conclude that the true statement is the one emphasizing the necessity to specify both the currency and terms of delivery in international price quotations to avoid misunderstandings.