International Business Class (Scenario)
Students in Professor Manning's international business class have been assigned the task of explaining the different types of FDI. Professor Manning formed groups among students. The groups are to research their assigned topic and present their information to the class using examples of real-world firms for illustration. Jessica Hanson is the leader of Group A; Manu Patel is the leader of Group B; and Mario Witherspoon is the leader of Group C.
-During her presentation, Jessica describes how two automakers joined forces and formed a separate firm by pooling their assets. Which of the following topics was most likely assigned to Group A?
A) equity joint venture
B) acquisition
C) greenfield investment
D) vertical integration

Question

Quizplus · Accepted Answer

Jessica's description of two automakers joining forces to form a separate firm by pooling their assets is a classic example of an equity joint venture. This type of FDI involves two or more companies creating a new, jointly owned enterprise.