Indirect Effects of FDI on Employment in a Host Country

question 40

Multiple Choice

Indirect effects of FDI on employment in a host country arise when

• A)a foreign MNE employs a number of host-country citizens.
• B)jobs are created because of increased local spending by employees of an MNE.
• C)an MNE brings in managers from the home country for its operations in the host country.
• D)an MNE recruits people from the host country for research and development.
• E)an MNE sends home country employees to host countries for training.

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Definitions:

Income Statement Approach

A method used to determine income tax liabilities by examining the revenues, expenses, gains, and losses reported on a company's income statement.

Adjusting Entry

A journal entry made at the end of an accounting period to allocate income and expenditure to the period in which they actually occurred.

Bad Debts

Accounts receivable that a company does not expect to collect and therefore writes off as a loss.

Allowance for Doubtful Accounts

A contra-asset account that estimates the portion of accounts receivable which may never be collected.