World Trade Organization (WTO)
Corporate Governance
Shareholder Wealth Maximization
Multinational Corporation (MNC)
Theory of Comparative Advantage
Political Risk
Market Imperfections
European Central Bank
Foreign Exchange Risk
General Agreement on Tariffs and Trade (GATT)
this represents the most important objective of corporate management that managers of companies should keep in mind when the make important corporate decisions. Managers can maximize shareholder wealth by maximizing the market value of the firm.
an agreement that supports the existence of international trade. This theory states that it is mutually beneficial for countries to specialize in the production of goods that they can produce most efficiently and then engage in trade.
the central bank of the 11 countries that make up the EMU, responsible for maintaining price stability via monetary police.
potential losses to the parent firm resulting from adverse political developments in the host country.
A multilateral agreement between member countries to promote international trade. The GATT played a key role in reducing international trade barriers.
various frictions, such as transaction costs and legal restrictions, that prevent the markets from functioning perfectly.
the economic, legal, and institutional framework in which corporate control and cash flow rights are distributed among shareholders, managers, and other stakeholders of the company.
refers to a firm that has business activities and interests in multiple countries.
permanent international organization created by the Uruguay Round to replace GATT. The WTO has the power to enforce international trade rules.
the risk of facing uncertain future exchange rates.
