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Direct investment usually involve the transfer of all of the above except: A. Capital B. Technology...

Direct investment usually involve the transfer of all of the above except:
A. Capital
B. Technology
C. Management
D. Bonds
*Instructions: Choose just one correct answer and provide a clear detailed explanation why you chose it.
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Answer #1

"A"

Direct investment usually involves the transfer of Capital. Capital may be used in the host country to start a manufacturing unit or marketing new products etc.

Let's take an example of Nokia. Nokia is a Finnish company now owned by Microsoft, it had its manufacturing in many countries. The technology they are using is protected under several treaties and it's not transferred or everyone will start making a Nokia.

Management sits in the US now and they might delegate some function to local places i.e. host countries. Bonds are used to raising funds.

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