Scenario: Global Manufacturing,Inc.(GMI)
GMI is a fast-growing Canadian company that wants a production system that makes each of its product's two components in the location where the cost of production is lowest.The components will then be taken to maquiladoras for final assembly.GMI purchased an existing company in Brazil to produce component A and built a subsidiary in Thailand to produce component B.
-GMI's company purchase in Brazil and subsidiary construction in Thailand would appear in which of the following?
A)Current account of Canada
B)Capital account of the World Trade Organization
C)Capital accounts of Brazil,Thailand,and Canada
D)Current accounts of Brazil and Thailand

Question

Quizplus · Accepted Answer

The purchase of a company in Brazil and the construction of a subsidiary in Thailand are capital investments, which are recorded in the capital accounts of the respective countries involved: Brazil, Thailand, and Canada.

Scenario: Global Manufacturing,Inc.(GMI) GMI Is a Fast-Growing Canadian Company That Wants a Production