International Corporate Finance Lecture Notes

These flashcards cover essential vocabulary and definitions from the lecture notes on international corporate finance.

Multinational Corporation (MNC)

A firm that engages in some form of international business, operating in more than one country.

Comparative Advantage Theory

The theory that a firm should specialize in producing goods or services for which it has a comparative advantage and trade for the rest.

Imperfect Markets Theory

The theory that some factors of production are not transferable across borders, which may limit a firm's ability to compete internationally.

Foreign Direct Investment (FDI)

Investment made by a firm or individual in one country in business interests in another country.

International Trade

The exchange of goods and services between countries.

Licensing

A legal arrangement where one company allows another to use its intellectual property in exchange for a fee or royalty.

Franchising

A method of scaling a business where a franchisor licenses its trade name and operating methods to a franchisee.

Joint Venture

A business arrangement where two or more parties agree to pool their resources for a specific task, sharing both risks and rewards.

Valuation of MNC

The process of determining the total value of a multinational corporation based on expected future cash flows and currency exchange rates.

Agency Costs

The costs associated with conflicts of interest between the management of a firm and its shareholders.