Foreign Direct Investment (FDI):
A) is the same as a movement of portfolio capital.
B) usually does not involve the participation of MNCs.
C) usually involves a MNC investing in plant and equipment in a foreign country.
D) is illegal in high-income countries.
E) is illegal in middle-income countries.

Question

Quizplus · Accepted Answer

FDI typically involves multinational corporations (MNCs) investing in physical assets such as plant and equipment in a foreign country, which is different from portfolio investment that involves buying stocks or bonds and does not necessarily entail direct control or management of the foreign operations.