Exam 8: Foreign Direct Investment

Since World War II, the largest source country for FDI has been

Why do many economists favor internalization theory as an explanation for FDI compared to Knickerbocker's theory?

In which way can the source country's balance of payments benefit from FDI made in a foreign country?

Which of the following best describes an industry composed of a limited number of large firms?

________ arises when two or more enterprises encounter each other in different regional markets, national markets, or industries.

Which of the following is an example of a greenfield investment?

An Italian car manufacturer purchases a U.S. producer of car tires. This is an example of

Recent years have seen a ________ in the number of countries that adhere to a radical ideology regarding FDI.

FDI can benefit the home country's ________ if the foreign subsidiary creates demands for home-country exports of capital equipment, intermediate goods, complementary products, and the like.

What is the primary reason Africa has attracted FDI in recent years?

If the FDI is a substitute for imports of goods or services, the effect can be to improve the ________ of the host country's balance of payments.

The country of Manystan has adopted neither a radical policy nor a free market policy, but rather one that posits that FDI has both benefits and costs. This is best described as

What are the possible adverse effects of FDI on a host country's balance-of-payments position?

In which of the following situations does the internalization theory recommend FDI as opposed to licensing?

Discuss the reasons for the growth in FDI over the past 30 years.

What is double taxation in the context of FDI?

How is the adverse effect of the balance of payments for the home country due to FDI usually offset?

According to the pragmatic nationalistic view, the MNE is a tool for exploiting host countries to the exclusive benefit of their capitalist-imperialist home countries.

________ arises when two or more enterprises encounter each other in different regional markets, national markets, or industries.

Licensing is usually a good option for firms in high-tech industries where protecting firm-specific expertise is of paramount importance.