RSM490H1 Midterm: RSM490 Global Business Midterm Notes.docx

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International business (ib): a business that engages in international economic activities or doing the action of business abroad. Multinational enterprise (mne): a firm that engages in foreign direct investment (fdi) Foreign direct investment (fdi): investment in, controlling and managing value added activities in other countries. Ib has two sides, foreign entrants, existing domestic firms. Global business: business around the globe that include both foreign and domestic sides. Gross domestic product (gdp): the sum of value added by resident firms, households and government operating in an economy. Purchasing power parity (ppp): a conversion that determines the equivalent amount of goods and services different currencies can purchase. Adjustment to reflect differences in cost of living. Cost of living in emerging markets tends to be lower. Gross national product (gnp): gdp plus income from nonresident sources abroad. Gross national income (gni): gdp + income from nonresident sources abroad. Triad: north america, western europe and japan.