Which scenario best demonstrates foreign direct investment?
A) Pure Pearls, a jewelry store in the United States, imports harvested pearls from Indonesia, Philippines, and Australia.
B) Chivalry, a U.S.-based phone manufacturing company, has set up its own assembly plant in Japan to cater to the needs of the Asian market.
C) Delicate Love, a reputable florist company in Holland, exports tulips and roses throughout the globe.
D) Samantha started an Italian restaurant in her home country, the United States, after she took cooking lessons from a well-known chef in Italy.
E) Yin and Yang Inc., a Chinese firm, supplies buttons and zippers to major denim brands in the United Kingdom.

Question

Quizplus · Accepted Answer

Chivalry, a U.S.-based phone manufacturing company, has set up its own assembly plant in Japan to cater to the needs of the Asian market. This is an example of foreign direct investment, where a company from one country (U.S.) invests in a physical asset (assembly plant) in another country (Japan).

Which Scenario Best Demonstrates Foreign Direct Investment