Use the following two statements to answer this question:
I.Portfolio flows are investments in financial securities and in companies by firms.
II.Foreign direct investments include investments in real assets.

Question

Quizplus · Accepted Answer

I is incorrect because portfolio flows refer specifically to investments in financial assets such as stocks and bonds, rather than investments in companies by firms, which can also include direct investments. II is correct because foreign direct investments (FDIs) indeed include investments in real assets, such as factories, land, and buildings, in a foreign country.

Use the Following Two Statements to Answer This Question