Glossary

National Tax Policy

The way in which a nation chooses to allocate the burdens of tax collections across its residents.

National Treatment

A country accords no less favorable treatment to imported goods than it does to domestic goods.

Nationalization

A process whereby privately owned companies are brought under state ownership and control (contrast with privatization).

Natural Advantage

Theory in economics that certain countries have a competitive advantage in certain products due to their access to specific natural resources, their climactic conditions, or their transportation system.

Negative-NPV Tie-in Project

A negative net present value infrastructure development project that a local government requires of a company pursuing a positive-NPV investment project elsewhere in the economy.

Net Asset Value (NAV)

The sum of the individual asset values in a closed-end mutual fund. Closed-end funds can sell at substantial premiums or discounts to their net asset values.

Net Currency Exposure

Exposure to foreign exchange risk after netting all intracompany cash flows.

Net Exposed Assets

Exposed assets less exposed liabilities. The term is used with market values or, in translation accounting, with book values.

Net Monetary Assets

Monetary assets less monetary liabilities.

Net Position

A currency position after aggregating and canceling all offsetting transactions in each currency, maturity, and security.

Net Present Value (NPV)

The present value of future cash returns, discounted at the appropriate market interest rate, minus the present value of the cost of the investment.

Net Working Capital

Current assets minus current liabilities.

New Protectionism

Recent efforts to pressure national governments to exercise greater control over foreign trade and foreign direct investment.

New-to-export (NTE)

The name of the circumstances of a company that either engages in export activities for the first time, engages in exportation for first time in twenty-four months, or has only exported to because of prior unsolicited orders. Export assistance is available to companies with this classification.

New-to-market (NTM)

The name of the circumstances under which a company exports to a foreign market in which it has either never exported to, has not exported to for the past twenty-four months, or has only exported to because of prior unsolicited orders. Assistance is available to companies with this classification.

Newly Industrializing Countries (NIC)

A group of former LDC countries who, due to high levels of economic growth, have grown rapidly in recent years.

Nominal Cash Flow

A cash flow expressed in nominal terms if the actual dollars to be received (or paid out) are given.

Nominal Interest Rate

Interest rate unadjusted for inflation.

Non-governmental Organizations (NGOs)

Special interest groups that operate in the global community.

Non-market Economy

An economy in which the government, through the use of central planning, makes most economic decisions to control economic activity.

Non-tariff Barrier

An indirect measure used to discriminate against foreign manufacturers, for example, extensive inspection procedures for foreign imports that create barriers to entering the market.

Noncash Item

Expense against revenue that does not directly affect cash flow, such as depreciation and deferred taxes.

Nonintermediated Debt Market

A financial market in which borrowers (governments and large corporations) appeal directly to savers for debt capital through the securities markets without using a financial institution as intermediary.

Nonmonetary Assets and Liabilities

Assets and liabilities with noncontractual payoffs.

Nordic Council

A regional alliance established in 1952 between Norway, Sweden, Finland, Denmark, and Iceland that is dedicated to cooperation among the Nordic countries. This has led to a common labor market, social security, and free movement of citizens across borders.

Normal Distribution

Symmetric bell-shaped frequency distribution that can be defined by its mean and standard deviation.

Normal Trade Relations (NTR)

New name for Most Favored Nation (MFN) trading status, in which the country which grants this status accords the recipient's imports and exports the most favorable treatment that it accords any country.

North American Free Trade Agreement (NAFTA)

NAFTA is a regional trade pact among the United States, Canada, and Mexico.

North-south Trade

A name for trade between developed (northern) and less developed countries (southern).

Notional Principal

In a swap agreement, a principal amount that is only “notional” and is not exchanged.