The acquisition of a new physical asset by a foreign resident is called
A) foreign direct investment.
B) foreign capital investment.
C) a portfolio inflow.
D) a portfolio outflow.

Question

Quizplus · Accepted Answer

A foreign direct investment refers to a foreign resident acquiring and managing a physical asset, such as a factory or a piece of real estate, in another country. This type of investment involves a long-term commitment and often includes controlling ownership in the foreign company or asset. In contrast, portfolio inflows and outflows refer to shorter-term investments in stocks or bonds, while foreign capital investment is a broad term that can encompass various types of investments.

The Acquisition of a New Physical Asset by a Foreign