Of the Following,which Is NOT an Example of a Foreign

question 38

Multiple Choice

Of the following,which is NOT an example of a foreign direct investment?​

• A) ​Acquisition of a foreign company
• B) ​Creation of new manufacturing facilities abroad
• C) ​Creation of new research facilities abroad
• D) ​Expansion of an existing plant in a foreign country
• E) ​Financial capital flows between countries

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Definitions:

Operating Activities

Cash flows directly related to earning income, including day-to-day transactions like selling products and paying wages.

Financing Activities

Transactions that result in changes in the size and composition of the equity capital or borrowings of the entity, as reported in a company’s cash flow statement.

Non-current Liability

Liabilities that are not due within the next twelve months, such as long-term loans, bonds payable, and deferred tax liabilities.

Short-term Loans

Loans scheduled to be repaid in less than a year, typically used for immediate cash flow needs or small-scale expenses.