FDI
Since World War II, this country has been the largest source of foreign direct investment.
What is the United States?
This is the oldest and simplest instrument of trade policy.
What are tariffs?
This level of integration removes internal tariffs and adopts a common external trade policy.
What is a customs union?
Banks offer higher interest rates on these deposits because they lack government regulation.
What are Eurocurrency deposits?
When investors buy a corporate bond, they receive this from the corporation.
What is a fixed stream of income?
This term refers to the amount of FDI undertaken over a given time period.
What is flow?
These are bureaucratic rules designed to make it difficult for imports to enter a country.
What are administrative trade policies?
From least to most integrated: free trade area, customs union, common market, economic union, and this final stage.
What is a political union?
This refers to the adverse consequences of unpredictable changes in exchange rates.
What is foreign exchange risk?
If a corporation takes out this type of financing, it must repay at regular intervals regardless of profit.
What is debt financing (a debt loan)?
This type of FDI occurs when a company builds new operations in another country from scratch.
What is a greenfield investment?
Tariffs levied as a proportion of the value of an imported good are called these.
What are ad valorem tariffs?
This 1992 treaty committed EC members to adopt a common currency by 1999.
What is the Maastricht Treaty?
When demand for dollars exceeds supply and yen supply exceeds demand, this happens to the dollar relative to the yen.
What is the dollar appreciates against the yen?
These funds often make short bets on assets they expect to decline in value.
What are hedge funds?
This view argues multinational enterprises extract profits from host countries without giving value in return.
What is the radical view?
Selling goods in a foreign market below cost of production is known as this.
What is dumping?
To qualify for EU membership, new applicants were required to implement this market reform.
What is deregulation of markets?
A currency that allows both residents and nonresidents to purchase unlimited foreign currency is described as this.
What is freely convertible?
This method uses price and volume data to identify trends expected to continue.
What is technical analysis?
FDI can benefit the home country’s ______ if foreign subsidiaries create demand for exports of capital equipment and goods.
What is the balance of payments?
These duties are imposed to offset dumping practices.
What are countervailing duties?
Adoption of this currency required participating nations to give up control over monetary policy.
What is the euro?
This foreign exchange trading center has the highest percentage of global trading activity.
What is London?
International diversification reduces risk, but this limits its effectiveness under the current system.
What are volatile exchange rates?