Question

CopperCore Inc., a U.S. business, took a 31 percent equity interest in Javier Holdings, a family business based in Spain. According to the U.S. Department of Commerce, this would be an example of

Answer 1

Answer: Foreign direct investment

Explanation: This would be an example of a foreign direct investment according to the U.S. Department of Commerce. A foreign direct investment is one such as a business or individual in one country buying into business interests in another country and usually occurs when such entities establish foreign business operations or is engaged in the acquisition of foreign business assets in a foreign company.

Foreign direct investments are of three types (horizontal, vertical and conglomerate) are are carried out to expand the investment base in a country, create employment through the creation of newer job opportunities, the introduction of advanced technology and so on.