Which of the following statements is true?
A) Multinational firms tend to reduce the flow of technology between countries.
B) Most foreign direct investment is found in labor-intensive industries.
C) Multinationals do not always help to reduce the trade deficit of the host country.
D) Foreign firms contribute to a significant increase in the host country's unemployment rate.
E) Foreign direct investment reduces the stock of capital of the domestic country.

Question

Quizplus · Accepted Answer

While multinational firms can bring in investment, they may not always help to reduce the trade deficit of the host country. This is because they may prioritize exporting goods and profits back to their home country rather than investing in local manufacturing and exports. The other statements are false.

Which of the Following Statements Is True