Josh runs a landscaping business in Vermont and decides to hire two people in India to maintain his bookkeeping for him electronically. Josh can pay them much less than he would pay a bookkeeper in the U.S., and the workers enjoy a higher quality of life in India thanks to their jobs with Josh's company. Josh's actions are an example of:
A) foreign portfolio investment.
B) foreign direct investment.
C) importing.
D) exporting.

Question

Quizplus · Accepted Answer

Josh's hiring of workers in India to maintain his bookkeeping is an example of foreign direct investment (FDI) because he is directly investing in the operations of his business in India by hiring workers there. This is different from importing or exporting which refers to the buying and selling of goods or services across borders. Furthermore, foreign portfolio investment involves investing in stock or bonds of foreign companies rather than directly investing in the operations of a business.

Josh Runs a Landscaping Business in Vermont and Decides to Hire