Foreign investment is an important source of capital formation in developing countries.

Question

Quizplus · Accepted Answer

Foreign investment can provide much-needed capital for developing countries, which can lead to increased economic growth, job creation, and overall development. This can take the form of foreign direct investment (FDI), where a company or individual invests directly in a foreign country's economy, or portfolio investment, where an investor purchases stocks or bonds in a foreign company or government. However, it is also important to recognize the potential risks and challenges associated with foreign investment, such as the possibility of capital flight, unbalanced economic growth, and dependence on foreign investors.

Foreign Investment Is an Important Source of Capital Formation in Developing