The ________ is one reason a company might prefer FDI over exporting.
A) presence or threat of trade barriers
B) costs of acquiring a foreign enterprise
C) costs of establishing production facilities in a foreign country
D) risk of giving away valuable technological know-how to a potential foreign competitor
E) possibility of diminishing returns

Question

Quizplus · Accepted Answer

FDI (Foreign Direct Investment) is often preferred over exporting when there are trade barriers such as tariffs or quotas that make exporting goods more expensive or difficult.

The ________ Is One Reason a Company Might Prefer FDI