EBK PRINCIPLES OF ECONOMICS
8th Edition
ISBN: 8220103600453
Author: Mankiw
Publisher: CENGAGE L
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Question
Chapter 31, Problem 3PA
To determine
The difference between foreign direct investment and foreign portfolio investment.
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Describe the difference between foreign direct investment and foreign portfolio investment. Who is more likely to engage in foreign direct investment – a corporation or an individual investor? Who is more likely to engage in foreign portfolio investment?
Which of the following would be U.S. foreign direct investment?
A.
A U.S. canning factory opens a plant in Ecuador.
B.
A Bolivian bank buys U.S. corporate bonds.
C.
A Polish company opens a shipbuilding plant in the United States.
D.
A U.S. bank buys Bolivian corporate bonds.
Hello, I keep getting this question wrong on my practice quiz but im not sure what im doing wrong.
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Similar questions
- What is the difference between foreign direct investment and portfolio investment?arrow_forwardWhat are the benefits and costs associated with foreign portfolio investment (FPI)?arrow_forwardProvide two ways in which the criteria for investing differ between Foreign Direct Investment and Foreign Portfolio Investment?arrow_forward
- Which is an example of foreign portfolio investment? a. Australian tourists going on a safari in Kenya. b. Indonesian merchants selling coffee beans to Japanese importers. c. US consumers increasing their demand for German automobiles. d. Brazilian banks using pesos to buy stock in Mexican corporations.arrow_forwardWhich of the following is an example of U.S. foreign portfolio investment? Select one: a.Erica, a U.S. resident, buys bonds issued by the Swiss government. b.Neither A nor B are examples of U.S. portfolio investment. C.A U.S. legal office opens a branch office in Holland. d.Both A and B are examples of U.S. portfolio investment.arrow_forwardWhat are the trends regarding foreign direct investment (FDI) in the world economy?arrow_forward
- What is Foreign Direct Investment (FDI) all about?arrow_forwardWhich 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.arrow_forwardIn the United States, several states and localities actively seek investment from enterprises from other regions of the country. Why areUS investors concerned about foreign investment?arrow_forward
- Explain briefly what international investment law does. Why is it important? Is it a good or bad thing?arrow_forwardWhich of the following is an example of foreign direct investment? Select one: a. A Brazilian firm opens a production plant in Argentina. O b. Chinese tourists visit the United States. 0 с. Od. A business from Ontario, Canada, opens a production plant in Manitoba, Canada. Italian savers buy British stocks.arrow_forwardExplain the difference between foreign direct investment (FDI) and foreign portfolio investment (FPI)? Explain which one is more useful to accelerate economic growth of home country.arrow_forward
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