Which situation represents an indirect effect of FDI on employment in a host country?
A) Jasper Inc. is a foreign MNE and employs a number of host-country citizens.
B) The employees of ShrillPlans Corp. have more money to spend and as a result, more home construction jobs are being created in the country.
C) DynaDigs brought in managers from the home country for its operations in the host country.
D) RaceandRoll Corp. recruits people from the host country for research and development.
E) Mills Rite Inc. sends home country employees to host countries for training.

Question

Quizplus · Accepted Answer

The indirect effect of FDI on employment occurs when the presence of foreign companies increases the overall economic activity, leading to job creation in other sectors, such as increased spending by employees leading to more jobs in home construction.

Which Situation Represents an Indirect Effect of FDI on Employment