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What Is Direct Foreign Investment? What Are the Additional Risks

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Essay

What is direct foreign investment? What are the additional risks that a multinational corporation must consider before undertaking direct investment in a foreign country?


Definitions:

Managerial Authority

The legal or organizational power granted to managers to make decisions, allocate resources, and direct the activities of others within an organization.

Labor Problem

Issues arising from employment relationships, including disputes over wages, working conditions, union rights, and employer practices.

Bargaining Power

The capacity of one party to influence the terms of negotiation or outcomes to its advantage.

Labor Market Outcomes

The results or consequences of interaction between job seekers and employers in the labor market, often measured by factors such as employment rates, wage levels, and the quality of working conditions.

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