Define the Term 'Foreign Direct Investment (FDI)

question 13

Essay

Define the term 'foreign direct investment (FDI)'. Why is business confidence in the prospective host country so important when making FDI decisions?

---

Definitions:

Inflation

The surge in the overall pricing structure for goods and services, undermining the efficiency of spending.

Goods and Services

The outputs produced by the economy, where goods are tangible objects and services are intangible offerings that satisfy consumer needs or wants.

Real GDP

The measure of a country's economic output adjusted for price changes (inflation or deflation), reflecting the true value of goods and services produced over a specific period.

GDP

Gross Domestic Product, the total monetary value of all goods and services produced within a country's borders in a specific time period, used as a broad measure of economic activity.