Which of the following is a risk associated with FDI?
A)Giving away valuable technological know-how to a potential competitor
B)High transportation costs,especially of products that have a low value-to-weight ratio
C)Doing business in a different culture where the rules of the game may be very different
D)Actual or threatened trade barriers such as import tariffs or quotas

Question

Quizplus · Accepted Answer

FDI is risky because of the problems associated with doing business in a different culture where the rules of the game may be very different.Relative to indigenous firms,there is a greater probability that a foreign firm undertaking FDI in a country for the first time will make costly mistakes due to its ignorance.

Which of the Following Is a Risk Associated with FDI