Environment of Global Finance

variables

world markets are
exports, imports, the trade balance, and exchange rates.

export more than they import

Economies buy
and sell

goods and services

capital assets in world financial markets.

favourable balance of trade

import more than they export

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Nations try

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to maintain a

favourable balance of trade, which assures them of the means to buy

necessary imports.

visible trade

invisible trade

involves the import and export of
goods and merchandise

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Brazilian coffee is usually transported

by ocean vessels because these ships are the cheapest method of

transportation

The workers send

money home to support family

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immigrant remittances.

In subsequent years, an investment should yield a profit.

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Capital for investments abroad can be restricted by requiring
government approval for any new foreign investments.

If these measures are insufficient, a country may devalue its currency

unfavourable balance of trade