definations Flashcards
memorizing
International business
all business activities that involve exchanges across national boundaries
Absolute advantage
the ability to produce a specific product more efficiently than any other nation
Comparative advantage
the ability to produce a specific product more efficiently than any other product
Exporting
– selling and shipping raw materials or products to other nations
Importing
purchasing raw materials or products in other nations and bringing them into one’s own country
Balance of trade
the total value of a nation’s exports minus the total value of its imports over some period of time
Balance of payments
the total flow of money into a country minus the total flow of money out of that country over some period of time
Licensing
a contractual agreement in which one business permits another to produce and market its product and use its brand name in return for a royalty or other compensation
Letter of credit
issued by a bank on request of an importer stating that the bank will pay an amount of money to a stated beneficiary
Bill of lading
document issued by a transport carrier to an exporter to prove that merchandise has been shipped
Draft
issued by the exporter’s bank, ordering the importer’s bank to pay for the merchandise, thus guaranteeing payment once accepted by the importer’s bank
Totally owned facilities
a business’s own production and marketing facilities in one or more foreign countries
Strategic alliance
a partnership formed to create competitive advantage on a worldwide basis
Trading company
provides a link between buyers and sellers in different countries.
Multinational enterprise
a business that operates on a worldwide scale without ties to any specific nation or region
Dumping
– exportation of large quantities of a product at a price lower than that of the same product in the home market
Import duty (tariff)
a tax levied on a particular foreign product entering a country
Non-tariff barrier
– a non-tax measure imposed by a government to favour domestic over foreign suppliers
General Agreement on Tariffs and Trade (GATT)
an international organisation of 164 nations dedicated to reducing or eliminating tariffs and other barriers to world trade
World Trade Organization (WTO)
powerful successor to GATT that incorporates trade in goods, services and ideas
International Monetary Fund (IMF)
an international bank that makes short-term loans to developing countries experiencing balance-of-payment deficits
intermediaries
people or agencies that
arrange agreements
between two other parties,
facilitating a deal or
outcome that suits everyone
joint venture
a partnership formed to
achieve a specific goal or
to operate for a specific
period of time
direct investment
a situation in which a
multinational company
sets up and runs it own
operations in a foreign
country
