Which of the following statements best describes the global direct investment entry strategy? With a direct investment, a company retains full ownership of its factories, operating facilities, and offices in a foreign country. Direct investment occurs when a company enters a new market by pooling its resources with those of a local company to form a new venture in which ownership, control and profits are shared. Direct investment refers to the deposit of wage funds in a foreign bank. Direct investment refers to the maximum amount of a product that can be brought into a country during a specified period of time. Direct investment occurs when a producer sells its supply in a foreign market at a price below its cost of production.
Answer 1
Explanation: FDI basically involves the expansion of business and commercial operations of a firm or company based in a certain country into another foreign country. Hence, it denotes a form of international business investment by any firm or business primarily for the purpose of gaining market share and ensuring long-term economic profitability. There are different ways or strategies that can be used to develop international or offshore business operations or investments, such as starting a subsidiary or affiliate in one foreign country by the company or company located in another country, acquisition or merger with a foreign corporation or corporation, establishing joint ventures with any foreign corporation or corporation or obtaining access to voting shares of any foreign corporation. Therefore, the absolute acquisition or ownership of any foreign company by any other company or company located in another country is one of the strategic procedures of the FDI. All these FDI strategies or procedures are primarily aimed at generating sustainable or long-term economic profitability through the expansion of business investment and business operations in foreign countries.