Which of the Following Is an Example of Direct Foreign

question 7

Multiple Choice

Which of the following is an example of direct foreign investment for a U.S.-based MNC?

• A) exporting to a country
• B) licensing arrangements that will allow a foreign country to use the MNC's technology
• C) purchasing existing companies in a country
• D) investing directly (without brokers) in foreign stocks

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Definitions:

Consumption Habits

The patterns or behaviors of individuals or groups in purchasing and using goods and services.

Dumping

Selling goods in a foreign market at a price below their cost of production or below the price in the domestic market.

Comparative Advantage

The principle that a country, individual, or company has over another in producing a particular good or service at a lower opportunity cost, allowing for beneficial trade and specialization.

Industrial North

The region in a country, historically in the United States, known for its heavy industry and manufacturing, contrasting with the agrarian South.