Terms used in International Business Environment

International Business Environment Terms Used

Absolute advantage-
A country has an absolute advantage when it is more
efficient than any other country at producing a product.


Balance of payments accounts
National accounts that track both payments to and
receipts from foreigners.


Bill of lading
A document issued to an exporter by a common carrier
transporting merchandise.


Common market-
A group of countries committed to the pursuit of a
common external trade policy

Comparative advantage
The theory that countries should specialize in the production of goods and services they can produce most efficiently .


Current account deficit-
The current account of the balance of payments is in
surplus when a country exports more goods and services
that it imports.


Deferral principle-
Parent companies are not taxed on the income of a
foreign subsidiary until they actually receive a dividend
from that subsidiary.


Economic risk-
The likelihood that events, including economic mismanagement, will cause drastic changes in a country’s
business environment that adversely affect the profit and
other goals of a particular business enterprise.


Eurobonds
A bond placed in countries other that the one in whose
currency the bond is denominated.


Eurocurrency-
Any currency banked outside of its country of origin.


European Monetary System (EMS)
EU system designed to create a zone of monetary stability
in Europe, control inflation, and coordinate exchange
rate policies of EU countries.


European Union (EU)
An economic group of 15 European nations: Austria,
Belgium, Great Britain, Denmark, Finland, France, Germany, Greece, the Netherlands, Ireland, Italy, Luxembourg, Portugal, Spain and Sweden

Exchange rate-
The rate at which one currency is converted into another.


Expatriate manager-
A national of one country appointed to a management
position in another country.


Exporting-
Sale of products produced in one country to residents of
another country.


Fixed exchange rates-
A system under which the exchange rate for converting
one currency into another is fixed.

For Reading About-International Business Environment-Basic Terms- Click here

Leave a Reply

Your email address will not be published.