Tax policies affect the incentive to engage in FDI and its means of financing for all of these reasons, except that they affect:

Question

Quizplus · Accepted Answer

Tax policies directly influence the profitability of foreign direct investment (FDI) and its relative attractiveness compared to domestic investment, as well as the cost of capital. However, they do not directly affect interest and exchange rates, which are influenced by broader economic policies and market conditions.

Tax Policies Affect the Incentive to Engage in FDI and Its