"Firms Prefer to Acquire Existing Assets Rather Than Undertake Greenfield

question 94

Essay

"Firms prefer to acquire existing assets rather than undertake greenfield investments while contemplating FDI." Explain the reasons that support this argument.

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Definitions:

Demand

The quantity of a good or service that consumers are willing to buy at a given price over a specified period.

Deadweight Loss

A loss in economic efficiency that occurs when the optimal quantity of a good is not produced, often due to market distortions.

Daily Demand

The total amount of a good or service that consumers are willing and able to purchase at a particular price in a single day.

Tax

A necessary financial obligation or variant form of imposition placed upon a taxpayer by a governing institution aimed at generating income for government use and public expense funding.