How Is the Adverse Effect of the Balance of Payments

question 73

Multiple Choice

How is the adverse effect of the balance of payments for the home country due to an FDI usually offset?

• A) By increased imports to the home country as a result of the FDI
• B) By the subsequent inflow of foreign earnings
• C) By substituting direct exports made earlier from the home country
• D) By further investments usually made to expand foreign operations

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