What is the advantage of foreign direct investment?
A)Retain advantage over competition
B)Reducing transportation costs
C)Creating a company tailored to a foreign market's unique characteristics
D)All of the above

Question

Quizplus · Accepted Answer

Foreign direct investment brings a set of advantages including retaining advantage over competition, reducing transportation costs, and creating a company tailored to a foreign market's unique characteristics. Companies that invest in foreign markets often enjoy a competitive advantage over their domestic counterparts, which remains unhindered by international competition. By setting up production facilities locally, companies are also able to avoid transportation costs and delays that can arise due to shipping their goods from the home country. Additionally, companies can adapt better to the unique characteristics of the foreign market by tailoring their products and services to meet the local demand, thus creating a larger customer base for their business.

What Is the Advantage of Foreign Direct Investment