IB 333

the ultimate goal of the management of a multinational firm to increase the vaule of the shareholder's investment as much as possible

The sum of the present valuesof all cash inflow investment project discounted of the cost of capital

The financial evaluation of a proposed investment to determine whether the expected returns are sufficient to justify the investment expenses

Upfront costs and expenses of a proposed investment

Cash flows arising from the firm's everyday business activities

Salvage valueor resale value of the project at its termination

A firm's combination of capital obtained by borrowing from others, such as banks (debts), and capital provided by owners (equity).

The management of a firm's current assests (cash, accounts receivable, invenories) and current liabilities (accounts payable, short-term debt).

The cash flows arising from the firm's funding activities

Cash flow coordination between a corporation's global units so that only one smaller cashtransfer mustbe made

Used by multinational firms to centralize individusl units' cash flows, resulting in less spending or foregone interest on unnecessary cash balances

Paying a debt early to take advantage of exchange rates

Paying a debt late to take advantage of exchange rates

The policy of buying goods from one unit, selling them to a second unit, and re-invoicing the sale to the next unit to take advantage of favorable exchange rates

A multinational firm's financial management tool that actually acts as a bank to coordinate finaances amoung its units

The potenial for losses of gains when a firm is engaged in a transaction denominated in a foreign currency

The structuring of a firm's operations so that cash flows by currency, inflows against outflows, are matched

A multinational firm's use a contracts to minimize its transaction exposer

The potenial for long term effects on a firm's value as the result of changing currency values

The potenial effect on a firm's financial statements of a change in a currency values

The range of Differences in national accounting practices

Taxes applied directly to income

Taxes applied to non income items, such as value- added taxes, excise taxes, tariffs, and so on

A tax on the value added at each stage of the production and distribution process; a tax assessed in the most European countries and also common amoung Latin American countries

Undertaking by a bank to amke payments to a seller upon completion of a set of agreed on conditions

A contract between an exporter and a carrier has accepted responsibility for the goods and will provide transportation in return for payment

A financial withdrawl document drawn against a bank

A financial withdrawl document drawn against a company