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Which of the following is not a type of foreign direct investment (FDI)?

A. Greenfield investment.
B. Joint venture.
C. Portfolio investment.
D. Merger and acquisition.

1 Answer

2 votes

Final answer:

Portfolio investment is not a type of foreign direct investment (FDI), as it involves a purely financial investment with no management responsibility and a short-term focus.

Step-by-step explanation:

The correct answer is C. Portfolio investment is not a type of foreign direct investment (FDI). Foreign direct investment refers to the investment in a foreign country where the investor acquires a significant ownership stake in a company and usually assumes managerial responsibility. It involves a long-term commitment and aims to establish a lasting presence in the foreign market. On the other hand, portfolio investment involves purchasing less than ten percent of a company and is a purely financial investment with no management responsibility. It is often made with a short-term focus and can be withdrawn more quickly than foreign direct investment.

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