Question

Which of the following would be an example of foreign direct investment from the United States...

Which of the following would be an example of foreign direct investment from the United States to Brazil?

A. A firm in the U.S. purchases Brazilian corporate bonds on the Brazilian bond market.

B. A US-based multinational firm buys a factory in Brazil from a Brazilian who had acquired it cheap from a bankrupt Brazilian manufacturer.

C. A rich American lends money to a rich Brazilian, to be used in expanding the Brazilians business.

D. A New York bank uses dollars that have been deposited in it by the government of an oil exporter to buy Brazilian government bonds denominated in dollars

I know the answer is B, but can someone explain why it is?

Business   Economics   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

Ans.

Correct Option is B because ,

By buying a brazillian manufacturing factory means that the US company has aquired the business assets of that company abroad, by doing that the US company can establish business operation in Brazil, which is the main motive of FDI.

So , thats why this option is correct because in other options you are not able to operate in that region.

-----------------------------------------------------------------------------------------

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Indicate how each of the following transactions will be recorded in the Jordanian Balance of Payments....
Indicate how each of the following transactions will be recorded in the Jordanian Balance of Payments. Classify each transaction as either a credit or debit in the current account or the financial account. Determine the subcategory of each transaction within the account. 1. A Japanese automobile manufacturer pays the salary of its managers working for a subsidiary in Jordan. 2. A Jordanian tourist pays for a hotel in Istanbul with his American Express card. 3. A Jordanian professor goes abroad...
Which of the following would be included as investment in the GDP accounts? a. the government...
Which of the following would be included as investment in the GDP accounts? a. the government buys goods from another country b. someone buys stock in an American company c. a firm increases its capital stock d. All of the above are correct. 2. Scenario 26-3. Assume the following information for an imaginary, open economy. Consumption = $1,000; investment = $200; net exports = -$50; taxes = $230; private saving = $225; and national saving = $150. Refer to Scenario...
Argentina and Ecuador: Understanding the Currency Crisis While fiscal policy is never far from the mind...
Argentina and Ecuador: Understanding the Currency Crisis While fiscal policy is never far from the mind of your average Argentine, who remembers the tough times and hyperinflation of the 1980s, the events of 2001 and 2002 have brought fiscal policy back to the forefront of public concern. Though the early 1990s may have been characterized by financial optimism, Argentina has been in a recession since Brazil's 1998 monetary crisis sent shockwaves across the regional and global markets. In early 2002,...
Delta airlines case study Global strategy. Describe the current global strategy and provide evidence about how...
Delta airlines case study Global strategy. Describe the current global strategy and provide evidence about how the firms resources incompetencies support the given pressures regarding costs and local responsiveness. Describe entry modes have they usually used, and whether they are appropriate for the given strategy. Any key issues in their global strategy? casestudy: Atlanta, June 17, 2014. Sea of Delta employees and their families swarmed between food trucks, amusement park booths, and entertainment venues that were scattered throughout what would...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT