Which of the Following Is an Example of Foreign Direct

question 206

Multiple Choice

Which of the following is an example of foreign direct investment?

• A)You purchase a plane ticket to China on American Airlines.
• B)American Airlines builds a hub in China.
• C)You buy a plane that was made in China.
• D)A stock broker from China sells you a Chinese government savings bond.

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Definitions:

Fixed Costs

Overheads such as rent, salaries, and insurance that do not fluctuate with the level of goods produced or sold.

Variable Costs

Charges that vary in relation to the volume of output or services provided by a firm.

Fixed Costs

Expenses that do not change regardless of the level of production or business activity, such as rent, salaries, and insurance.

Selling Price

The amount of money for which an item is sold, potentially different from listing or cost price due to discounts or negotiations.