QUESTION A firm’s bargaining power is low when the host government places a low value on what the firm has to offer. Indicate whether the statement is true or false. ANSWER TRUE From the perspective of a firm negotiating the terms of an investment with a host government, the firm’s bargaining power is high […]
Date: September 3rd, 2020
QUESTION Despite the move toward a free market stance in recent years, many countries still have a rather pragmatic stance toward FDI. Indicate whether the statement is true or false. ANSWER TRUE Despite the move toward a free market stance in recent years, many countries still have a rather pragmatic stance toward FDI. In […]
Date: September 3rd, 2020
QUESTION Which of the following is most likely to involve establishment of a new operation in a foreign country? A. Consolidation B. Greenfield investment C. Acquisition D. Licensing agreement E. Mass customization ANSWER B
Date: September 3rd, 2020
QUESTION Which of the following indicates that a firm has a full outright stake in an acquisition? A. Anderson Corporations acquires at least 75 percent of a company. B. Sheffield Enterprises acquires at least 60 percent of a company. C. Arthur Enterprises acquires 98 percent of a company. D. Maximus Corporations acquires 100 percent of […]
Date: September 3rd, 2020
QUESTION Once it undertakes FDI, a firm becomes a(n): A. outsourcer. B. retail chain. C. offshore company. D. multinational enterprise. E. national corporation. ANSWER D
Date: September 3rd, 2020
QUESTION Services such as telecommunications, retailing, and many financial services, where the service has to be produced where it is delivered, lend themselves well to exporting. Indicate whether the statement is true or false. ANSWER FALSE FDI’s impact on competition in domestic markets may be particularly important in the case of services, such as […]
Date: September 3rd, 2020
QUESTION According to the U.S. Department of Commerce, which of the following, occurs whenever a U.S. citizen, organization, or affiliated group takes an interest of 10 percent or more in a foreign business entity? A. Multilateral investment B. Foreign direct investment C. Reciprocal foreign investment D. International divestment E. Asset divestment ANSWER B
Date: September 3rd, 2020
QUESTION An acquisition does not result in a net increase in the number of players in a market. Indicate whether the statement is true or false. ANSWER TRUE An acquisition does not result in a net increase in the number of players in a market; the effect on competition may be neutral. When a […]
Date: September 3rd, 2020
QUESTION Which of the following refers to the amount of FDI undertaken over a given period (normally a year)? A. Portfolio B. Flow C. Status D. Stock E. Fragment ANSWER B
Date: September 3rd, 2020
QUESTION The indirect employment effects of FDI are often as large as, if not larger than, the direct effects. Indicate whether the statement is true or false. ANSWER TRUE The effects of FDI on employment are both direct and indirect. Direct effects arise when a foreign MNE employs a number of host-country citizens. Indirect […]
Date: September 3rd, 2020
