To discuss: The difference in the percentage in foreign direct investment (FDI) inflows in Country I and Country J.
Introduction:
Gross fixed capital formation is the investment in the fixed assets like warehouses, retail stores, and factories.
Explanation of Solution
The difference in the percentage in foreign direct investment (FDI) inflows in Country I and Country J are as follows:
The difference in the percentage in foreign direct investment (FDI) inflows in Country I and Country J mainly because of the government policies
Country I is basically a friendly FDI whereas Country J is not as such kind. Country J does not encourage inward FDI. Though these two countries are trade dependent economies with limited available resources Country I is comparable less mercantile in attitude with that of Country J. Country I has relatively low cost workforce, ample supply of labor and well educated.
Whereas work force of Country J is well educated is more expensive than the Country I.
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Chapter 8 Solutions
International Business: Competing in the Global Marketplace
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