When a firm establishes a presence in the foreign market by investing capital in and securing ownership of a factory, subsidiary, or other facility there, it is typically a(n) ________.
A) equity-based international business activity
B) contractual relationship
C) home-based international exchange activity
D) inbound international exchange activity

Question

Quizplus · Accepted Answer

Investing capital in and securing ownership of a physical facility in a foreign market is the definition of equity-based international business activity. This is often referred to as foreign direct investment (FDI).

When a Firm Establishes a Presence in the Foreign Market