Since shareholders of MNCs may indirectly benefit from corporate international diversification,
A)firms are motivated to undertake FDI for the purpose of providing shareholders with diversification services.
B)firms are motivated to undertake FDI for the purpose of being part of the global minimum variance portfolio.
C)firms are motivated to undertake FDI for the purpose of staying on the efficient frontier.
D)none of the options

Question

Quizplus · Accepted Answer

Firms undertake FDI primarily for strategic business reasons such as market expansion, resource acquisition, and competitive advantage, rather than to provide diversification services to shareholders.

Since Shareholders of MNCs May Indirectly Benefit from Corporate International