Which of the Following Would Be an Example of Direct

question 246

Multiple Choice

Which of the following would be an example of direct foreign investment in DVCs?

• A)a grant from the World Bank to build an irrigation project in Kenya
• B)the financing of a new chemical plant in Peru by a German company
• C)a low-interest loan from the U.S. government to Turkey to purchase military hardware
• D)a loan from the Japanese government to the Indonesian government to pay for electronic equipment

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Definitions:

Compounded Monthly

The process of adding interest to the principal sum of a loan or deposit, or in other words, interest on interest, with this process happening every month.

Compounded Monthly

A method of calculating interest where the accrued interest is added to the principal each month before the next interest calculation.

Compounded Quarterly

The technique of determining interest by taking into account the original principal sum and the interest that has accrued in earlier cycles, with this process being carried out every three months.

Compounded Semi-Annually

Interest on an investment is calculated and added to the principal every six months, with future interest then calculated on the new total.