Question Bank International Business - 5105 Words

Chapter 07 Foreign Direct Investment True / False Questions 1. (p. 242) A firm becomes a multinational enterprise when it undertakes foreign direct investment. TRUE 2. (p. 242) Licensing involves the establishment of a new operation in a foreign country. FALSE 3. (p. 242) If a firm that makes bicycles in Germany acquires a French bicycle producer, Greenfield investment has taken place. FALSE 4. (p. 242) The amount of FDI undertaken over a given time period is known as the flow of FDI. TRUE 5. (p. 242) The total accumulated value of foreign-owned assets at a given time is the inflow of FDI. FALSE 6. (p. 242) FDI is seen by executives as a means of circumventing future trade barriers. TRUE 7.†¦show more content†¦TRUE Multiple Choice Questions 41. (p. 242) FDI occurs when a A. Domestic firm imports products and services from another country B. Firm ships its product from one country to another C. Firm invests in the stock of another company D. Firm invests directly in facilities to produce and/or market a product in a foreign country 42. (p. 242) A Greenfield investment A. Is a form of FDI that involves the establishment of a new operation in a foreign country B. Involves a 7 percent stock in an acquired foreign business entity C. Involves a merger with a foreign business D. Occurs when a firm acquires another company in a foreign countr 43. (p. 242) If General Electric, a U.S. based corporation, purchased a 50% interest in a company in Italy, that purchase would be an example of a(n) A. Minority acquisition B. Outright stake C. Majority acquisition D. Greenfield investment 44. (p. 242) The amount of FDI undertaken over a given time period is A. The flow of FDI B. The stock of FDI C. The FDI outflow D. The FDI inflow 45. (p. 242) The stock of FDI is A. The amount of FDI undertaken over a given period of time B. The total accumulated value of foreign owned assets at a given time C. The flow of FDI out of a country D. The flow of FDI into a country 46. (p. 242) FDI has been rising for all of the following reasons,Show MoreRelatedAn Argument For An Organization953 Words   |  4 PagesUnit one Question one Propose an argument for organizations to become multinational. Your response should be at least 200 words in length. The main argument for organizations to become multination is to operate their businesses in different countries so that they can diversify their market beyond the national boundary. Multinational presence will enable the firms to operate their business activities in different countries for acquiring benefits regarding business and technical efficiency (CollinsRead MoreLegal Ethical and Regulatory Issues1479 Words   |  6 Pagescontinually evolving business. This paper will identify and describes the legal, ethical, and regulatory issues that impact online banking the Websites. 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