According to the textbook,FDI is expensive because
A) a firm must pay a high franchising fee to participate in foreign direct investment in most countries.
B) a firm must pay the transportation costs to ship domestically produced products overseas.
C) a firm must establish production facilities in a foreign country or acquire a foreign enterprise.
D) a firm must pay a high licensing fee to participate in foreign direct investment in most countries.
E) a firm must pay taxes in both countries.

Question

Quizplus · Accepted Answer

FDI involves establishing production facilities in a foreign country or acquiring a foreign enterprise, which can be a very expensive process. This includes costs such as purchasing land, building facilities, acquiring equipment, and hiring and training local employees. Additionally, there may be costs associated with complying with local laws and regulations, such as environmental and labor standards.

According to the Textbook,FDI Is Expensive Because