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Foreign Direct Investment (FDI) is often utilized as a market

entry mode due to its simplicity and lower levels of risk (a.) True
(b.) False

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Final answer:

FDI is not typically simple or of lower risk; instead, it involves significant financial commitment and managerial oversight with a long-term focus.

Step-by-step explanation:

The statement that Foreign Direct Investment (FDI) is often utilized as a market entry mode due to its simplicity and lower levels of risk is false. FDI involves substantial financial commitment, managerial involvement, and a long-term perspective. It is distinct from portfolio investment, which is generally more liquid and can be entered into or exited from with relative ease. FDI requires careful planning and a longer timeframe to execute changes in investment positions, and because it usually involves acquiring a significant stake in a foreign entity, it can entail higher levels of risk and complexity.

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