____ Is Not a Disadvantage of Direct Foreign Investment

question 28

Multiple Choice

____ is not a disadvantage of direct foreign investment.

• A) The expense of establishing a foreign subsidiary
• B) The uncertainty of inflation and exchange rate movements
• C) Political risk
• D) All of the above are disadvantages of direct foreign investment

---

Definitions:

Historical Rate

The exchange rate at which a foreign currency transaction was converted into the reporting currency at the time of the transaction.

Fluctuation

Variations or changes in value or level, often used in the context of financial markets or economic indicators.

Interest Rates

The cost of borrowing money or the return on savings, typically expressed as a percentage.

Trade Surpluses

An economic condition that occurs when a country's exports exceed its imports over a certain period of time, indicating a positive balance of trade.