Which of the following characteristics distinguishes foreign direct investment from other forms of investment?(1 point)

Question

Responses

Foreign direct investment involves significant control in a foreign business.
Foreign direct investment involves significant control in a foreign business.

Foreign direct investment involves the transfer of domestic capital to foreign countries.
Foreign direct investment involves the transfer of domestic capital to foreign countries.

Foreign direct investment involves the exchange of foreign assets for domestic assets.
Foreign direct investment involves the exchange of foreign assets for domestic assets.

Foreign direct investment involves domestic ownership of foreign assets.

Answer 1

The characteristic that distinguishes foreign direct investment (FDI) from other forms of investment is:

Foreign direct investment involves significant control in a foreign business.

This means that FDI typically includes acquiring a substantial ownership stake in a foreign company, allowing the investor to exert influence or direct control over the business operations.