Which of the following illustrates how foreign aid differs from foreign investment?(1 point)

Responses

Foreign aid involves the exchange of domestic capital for foreign land, capital, and labor.
Foreign aid involves the exchange of domestic capital for foreign land, capital, and labor.

Foreign aid involves the transfer of money to address economic, military, and humanitarian situations.
Foreign aid involves the transfer of money to address economic, military, and humanitarian situations.

Foreign aid provides the capital that developing countries need to increase economic output.
Foreign aid provides the capital that developing countries need to increase economic output.

Foreign aid involves the transfer of money from one country to another.

1 answer

The statement that best illustrates how foreign aid differs from foreign investment is:

Foreign aid involves the transfer of money to address economic, military, and humanitarian situations.

This highlights that foreign aid is typically aimed at addressing immediate needs and improving conditions in a recipient country, whereas foreign investment usually focuses on generating returns and involves investments made with the expectation of profits.