Which of the following is an example of foreign direct investment?
A) General Motors of the USA buys steel from South Korea.
B) General Motors of the USA buys shares in Saab of Sweden.
C) McDonald's builds a restaurant in Moscow.
D) UK publisher Bloomsbury sells the rights to make a film of a Harry Potter book to an American film studio.

Question

Quizplus · Accepted Answer

Foreign direct investment involves a company from one country making a direct investment in a company or project in another country. Building a McDonald's restaurant in Moscow is an example of foreign direct investment. Option A is a simple purchase of goods and does not involve investment in a company or project. Option B is the purchase of shares of a foreign company but is not a direct investment in a new company or project. Option D is a licensing agreement and does not involve direct investment in a company or project.

Which of the Following Is an Example of Foreign Direct