In an acquisition of assets, one firm acquires the assets of another company. None of the liabilities supporting that asset are transferred to the purchaser.

A tariff assessed as a percentage of the value of an import.

An increase in a currency value relative to another currency in a floating exchange rate system.

Bank, usually in the country of the seller, whose primary function is to authenticate the letter of credit and advise it to the seller.

The rate at which a market maker is willing to sell the quoted asset.

Those assets in which the firm has already invested. (Compare to growth options.)

Trading method in which the buyer pays for the goods before they are sent out , method is used when buyer is of unknown credit worthiness.

In a merger or acquisition, the difference between the purchase price and the preacquisition value of the target firm.

An accounting method that allocates costs to specific products based on breakdowns of cost drivers.

A guarantee of the buyer's credit provided by the guarantor, unless the buyer is of unquestioned financial standing. The aval is an endorsement note as opposed to a guarantee agreement.

A level stream of equal dollar payments that lasts for a fixed time. An example of an annuity is the coupon part of a bond with level annual payments.

The costs incurred to ensure that agents act in the best interest of the principal.

The target weights given to various asset classes in an investment portfolio.

The percentage cost of a financing alternative, including any bank fees or placement fees.

An absolute advantage exists when a nation or other economic region is able to produce a good or service more efficiently than a second nation or region.

A foreign exchange quotation that states the U.S. dollar price per foreign currency unit. (Contrast with European terms.)

Appellate Body

The total demand of all potential buyers of a commodity or service. Includes all individuals and organizations that have the ability, willingness, and authority to purchase such products.

Agreement on Textiles and Clothing

Someone who represents another. In corporate governance terminology, management is the agent of the principal stakeholders in a principal-agent relationship.

In the U.S. tax code, these rules define how income and deductions are to be allocated between domestic-source and foreign-source income.

A loose economic and geopolitical affiliation that includes Singapore, Brunei, Malaysia, Thailand, the Philippines, Indonesia, and Vietnam. Future members are likely to include Myanmar (Burma), Laos, and Cambodia.

An option with an exercise price that is equal to the current value of the underlying asset.

Changes in a corporation’s financial statements as a result of changes in currency values.

Asia-Pacific Economic Cooperation

Laws that are enacted to prevent dumping-offering prices in the overseas market that is lower than that at which a product is sold in its home domestic market.

The term used to calculate the present value of the stream of level payments for a fixed period.

The ABD Group is one of four major regional developmental banks currently operating in the global economy; it is headquartered in Abidjan, Cote d'Ivoire.

A valuation method that separately identifies the value of an unlevered project from the value of financing side effects.

An investment approach that actively shifts funds either between asset classes (asset allocation) or between individual securities (security selection).

In an acquisition of stock, one firm buys an equity interest in another.

The average project earnings after taxes and depreciation divided by the average book value of the investment during its life.

An option that can be exercised anytime until expiration. (Contrast with European option.)

The process of purchasing and selling foreign exchange, stocks, bonds and other commodities in several markets intending to make profit from the difference in price.

A forum designed to promote economic growth, cooperation, and integration among member nations. The most prominent members are China, Japan, and Korea.

In the U.S. tax code, income from an active business as opposed to passive investment income.

An asset pricing model that assumes a linear relation between required return and systematic risk as measured by one or more factors according to Rj = mj + b1jF1 + ... + bKjFK + ej.

Payment undertaking given by a bank in respect of a bill of exchange drawn.

Shares of a foreign corporation issued directly to U.S. investors through a transfer agent in accordance with SEC regulations.

Used to indicate that a shipper's agent or representative is not empowered to make definitive changes or adjustments without approval of the group or individual represented.

A regional trade pact that includes Venezuela, Colombia, Ecuador, Peru, and Bolivia.

One of four major regional develoment banks currently operating in the global economy; it is headquartered in Manila, Philippines.

The efficiency with which a market channels capital toward its most productive uses.

A nonnegotiable instrument of domestic and international air transport that functions as a bill of lading.

African, Caribbean, and Pacific countries.

Asia Development Bank, head quartered in Manila, Philippines.

It is also called "marine adventure." It is a term of art in the marine insurance business. All insured cargo owners and every shipper on that vessel are part of the adventure.

In models of international trade, a situation in which there is no cross-border trade.