International Economics - Terms for Reference - Education

Learners should necessarily know the different kinds of terms which are in use so that a better understanding of the various concepts in "International Finance" can be arrived at. The following are the illustrative examples of some terms used in regard to the various issues and dimensions in international economics and financial functioning of multinational firm:

Direct Investments: This refers to real investments in factories, capital goods, land and inventories in foreign country where both capital and management are involved and the investor retains direct control over the use of invested capital

International economics: International economics deals with the theory of trade, the theory of commercial policy or protectionism, foreign exchange markets, balance of payments and the adjustments in balance of payments

International finance: This refers to the macro aspects of international economics such as balance of payments and the adjustment policies

Portfolio Investments: This refers to purely financial assets such as bonds and stocks denominated in foreign currency

Conglomerate:? It is multiform organization dealing in different activities and different markets

Cost of capital: It stands for the weighted average of the cost of debt and equity

Defensive Investment: It is designed to checkmate the moves of composing firm or country (at a distance)

Direct Investment: It implies capital plus technology plus management

Golden hand shake: This implies (liberal) lumpsum payment in view of voluntary (premature) retirement of an employee, represents the origin of a multinational enterprise

Host country: This represents the presence of a multinational enterprise beyond the home country

Intellectual Property Rights: (IPRs) are in the nature of patents and copy rights

International Corporation: This has a fairly representative presence in the whole world

Mergers: It means merging of two units in the same organization or different organizations merging together to form a single organization.

Multi domestic enterprise: It takes equal cognizance of multinational and domestic interests

Multinational enterprise: It has its substantial presence in more than two countries

Pyramiding: It aims at controlling a large number of subsidiaries through the holding company device

Take-over: It implies that one form has acquired control over another firm

Think global and act local: It implies that a multinational enterprise, while taking decisions in a worldwide perspective, operates on the basis of local situation

Transfer pricing: It implies the techniques of charging for goods and services transferred from one undertaking to another undertaking within the same group

Transnational Corporation: It has a substantial presence beyond the home country

Trickling down investment: It is a situation where a country, having an inflow of investment from some country (countries), has smaller outflow of investment toward some other country (countries)

Xenophobia: It is a strong dislike or distrust of foreigners

Source: http://education.ezinemark.com/international-economics-terms-for-reference-185356421c1.html

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