Describe the Three Capacity Strategies and the Advantages of Each

question 58

Essay

Describe the three capacity strategies and the advantages of each.

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Definitions:

Capital Goods

Long-term assets used in the production of other goods and services, such as machinery, buildings, and equipment, essential for creating consumer goods.

Net Capital Outflow

The net flow of funds invested overseas by a country over a certain period, calculated as the difference between the capital leaving the country and capital entering it.

Foreign Direct Investment

An investment made by a company or individual in one country in business interests in another country, in the form of establishing business operations or acquiring business assets.

Foreign Portfolio Investment

Investments in foreign countries' securities, such as stocks and bonds, without control over the management of those entities.