Which of the following would be an example of foreign direct investment from the United States to Taiwan?
A)au.s. bank buys bonds issued by a taiwan computer manufacturer.
B)au.s.car manufacturer enters into a contract with a taiwan firm to make and sell it spark plugs.
C)microsoft hires a taiwanese computer programmer to debug some software for it.
D)the state of california rents space in taipei for one of its employees to use promoting tourism in

Question

Quizplus · Accepted Answer

Foreign direct investment (FDI) involves establishing a lasting interest and control in a foreign enterprise. When a U.S. car manufacturer enters into a contract with a Taiwanese firm to make and sell spark plugs, it's creating a business operation in Taiwan, which is a form of FDI. The other options involve buying bonds, hiring for services, or renting space, which do not constitute establishing or controlling a business operation in the foreign country.

Which of the Following Would Be an Example of Foreign