Which of the following are direct foreign investments, and which are not? Event a. A French company merges with an American company; stockholders in the U.S. company exchange their stock for shares in the French firm. b. The same Saudi businessman buys a New York apartment building. Is this a direct foreign investment? Yes Yes c. A Saudi businessman buys $10 million of IBM stock. No d. An Italian firm builds a plant in Russia and manages the plant as a contractor to the Russian government. No

Which of the following are direct foreign investments, and which are not? Event a. A French company merges with an American company; stockholders in the U.S. company exchange their stock for shares in the French firm. b. The same Saudi businessman buys a New York apartment building. Is this a direct foreign investment? Yes Yes c. A Saudi businessman buys $10 million of IBM stock. No d. An Italian firm builds a plant in Russia and manages the plant as a contractor to the Russian government. No

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Related questions

Q: Which of the following is true about BRIC countries: a. There is low prospects of growth b.…

A: The question is asking us to identify the correct statement about the BRIC countries. BRIC is an…

Q: Explain briefly whether each of the following would be more likely to lead to a higher level of…

A: The term trade refers to the situation under which the products and goods are traded in terms of…

Q: In the open-economy macroeconomic model, if investment demand increases, then the real interest rate…

A: In an open economy macroeconomic model, trade between countries takes place. The real interest rate…

Q: INTERNATIONAL TRADE Which of the following are direct foreign investments? Explain your answer.…

A: There are two types of international investments :- Direct foreign investment Portfolio foreign…

Q: The main items on the A. current account are imports and R.O.W. investments in Canada. B. financial…

A: Below are the important items of the BOP: 1. Export & import of goods. 2. Export & import…

Q: If the world real interest rate falls, then a country that is an international lender Select one: O…

A: If the world real interest rate falls, then a country that is an international lender Select one…

Q: When is a global strategy appropriate? (Think first of what a global, as opposed to merely…

A: Global strategy on the micro level is concerned with the efficient allotment of a company's…

Q: Which is an example of foreign portfolio investment? a. Australian tourists going on a safari in…

A: Foreign investments in a country often are of two categories namely: Foreign direct investment…

Q: 1 PART - I 1.1 Multiple Choice Questions Q1 If the government of a small open economy wishes to…

A: International economics is associated with issues that arise from the engagement of sovereign…

Q: Suppose that Brazil initially has a higher capital rental rate (r) than the United States. What…

A: DISCLAIMER “Since you have asked multiple questions, we will solve the first three subparts for…

Q: 6. Elasticity and total revenue The following graph illustrates the weekly demand curve for…

A: Total revenue refers to the money collected from the sale of goods. Total revenue is given by

Q: When there are two large open economies in the world, if capital goods become relativel cheaper…

A: An economy that engages in international trade and capital flows is said to have an open economy. In…

Q: Which of the following is an example of foreign direct investment? Select one: Ⓒa. A Brazilian firm…

A: Foreign direct investment refers to investment which originates from source country to destination…

Q: magine that Sony is having difficulty selling Playstations in Greece because of differences in local…

A: Foreign direct investment (FDI) is a form of cross-border funding made by using a company or…

Question

Which of the following are direct foreign investments, and which are not?
Event
a. A French company merges with an American company; stockholders in
the U.S. company exchange their stock for shares in the French firm.
b. The same Saudi businessman buys a New York apartment building.
c. A Saudi businessman buys $10 million of IBM stock.
Is this a direct
foreign investment?
d. An Italian firm builds a plant in Russia and manages the plant as a contractor to the
Russian government.
Yes
Yes
No
No

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1: Define the Problem

VIEW

Step 2: Analyze the Concept of Direct Foreign Investment

VIEW

Step 3: Determine the Criteria for Direct Foreign Investment

VIEW

Step 4: Examine Each Event

VIEW

Step 5: Understand Why Each Event is or isn’t a Direct Foreign Investment

VIEW

Solution

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 6 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

Read the news article â€œThe China Syndromeâ€ and discuss on the following questions:http://www.huffingtonpost.com/scott-paul/the-china-syndrome_b_1472301.htmlWhat has been the impact of granting China permanent trade status? Who has benefitted?How much has US dependency on lower priced goods from China, hurt overall job growth?Since it is considered that at some point China will drive the global economy, it is a soundagreement that reducing the trade barrier will affect the Chinese economy, causing a ripple effectfor global economy? Do you agree or disagree? Explain.
If U.S. residents purchase $600 billion worth of foreign assets and foreigner residents purchase $300 billion worth of U.S. assets, OA. U.S. net capital outflow is $300 billion; capital is flowing into the U.S. OB. U.S. net capital outflow is -$300 billion; capital is flowing into the U.S. OC. U.S. net capital outflow is -$300 billion; capital is flowing out of the U.S. OD. U.S. net capital outflow is $300 billion; capital is flowing out of the U.S. Reset Selection
provides some hypothetical data on macroeconomicaccountsforthreecountriesrepresented by A, B, and C and measured in billions of currency units. In Table, private household saving is SH, tax revenue is T, government spending is G, and investment spending is I. a. Calculate the trade balance and the net inflow of foreign saving for each country. b. State whether each one has a trade surplus or deficit (or balanced trade). c. State whether each is a net lender or borrower internationally and explain.
Which scenario best demonstrates foreign direct investment? Salia started a Polish restaurant in her home country, the United States, after she took cooking lessons from a well-known chef in Poland. Super Blooms, a reputable vegetable plant company in Holland, exports tomato, pepper, and potato garden plants across the globe. Ups n Downs Inc., a Chinese firm, supplies roller coaster components in the United States. Domesticity, a U.S.-based office furniture company, has set up its own assembly plant in Japan to cater to the needs of the Asian market. Lux Linens, a fabric conglomerate in the United States, imports raw silk from China and Italy.
From the book "Power and Plenty: Trade, War, and the World Economy in the Second Millennium" by Ronald Findlay and Kevin H. O'Rourke (2007) and "A History of the Global Economy: From 1500 to the Present" by Joerg Baten (2016). Discuss how does financial institutions and access to capital shaped the economic foundations of nations and lead to the varying ability of countries to invest in proximate factors such as physical capital and human capital. (please include a bibliography)
If foreigners want to invest more in the American economy______?Group of answer choices 1The exchange rate increases (the US $ appreciates). 2The exchange rate is unaffected. 3The exchange rate decreases (the US $ depreciates). 4The exchange rate could decrease (the US $ depreciates) or it could increase (the US $ appreciates).
8. State whether each of the following events involves a financial flow to the U.S. economy or away from the U.S. economy: a. Export sales to Germany b. Returns being paid on past U.S. financial investments in Brazil c. Foreign aid from the U.S. government to Egypt d. Imported oil from the Russian Federation e. Japanese investors buying U.S. real estate
Q3