What Is the Difference Between Foreign Direct Investment and Foreign

question 114

Multiple Choice

What is the difference between foreign direct investment and foreign portfolio investment?

• A)Foreign direct investment involves purchases of foreign stock or bonds by individuals or firms,while foreign portfolio investment involves a firm purchasing or building a facility in a foreign country.
• B)Individuals engage in foreign portfolio investment,but only firms can engage in foreign direct investment.
• C)Foreign direct investment only takes place when governments make official purchases or foreign investments,while foreign portfolio investment takes place when firms,individuals,or the government purchase foreign investments.
• D)Foreign direct investment can give a low-income country access to funds and technology it would not otherwise have,but foreign portfolio investment does not expand that access.

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Definitions:

Self-Enhancement Motive

The desire to learn favorable or flattering things about the self.

Appraisal Motive

The simple desire to learn the truth about oneself, whatever it is

Automatic Egotism

Response by the automatic system that “everything good is me, and everything bad is not me”

Duplex Mind

The concept that the human mind operates on two levels: a conscious, rational level and an unconscious, automatic level, affecting human behavior and cognition.