Which of the Following Best Describes Foreign Direct Investment (FDI)

question 49

Multiple Choice

Which of the following best describes foreign direct investment (FDI) ?

• A)A firm's direct investment in production and/or service activities abroad.
• B)The purchases of foreign securities by people within the United States.
• C) The purchases of U. S. securities by people from other countries.
• D) Avoidance of brokers or other financial intermediaries when making foreign investments.

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Definitions:

Interest Expense

Interest expense is the cost incurred by an entity for borrowed funds, typically presented as a line item on the income statement.

Fixed Expense

Fixed expense refers to costs that do not fluctuate with the level of goods or services produced by the business, such as rent, salaries, and insurance.

Borrowing Risk

The potential danger that borrowers might not be able to repay their loans or meet other financial obligations, leading to financial loss for the lender.

Accrued Interest

Interest that has been incurred but not yet paid at the end of a period.