Bric autos inc., a campora-based automobile company, made a capital investment of $300,000 to set up production units and distri

Question

3 years ago

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Bric autos inc., a campora-based automobile company, made a capital investment of $300,000 to set up production units and distri

bution channels in the country of bryon from where it plans to access the bryonian market. such investments are best known as _____.

Business

2 answers:

Naddik [55] · Answer 1 · 2022-03-25T05:28:59+03:00

Answer: Foreign Direct Investment

Explanation: In simple terms, Investments or businesses owned and controlled by an individual or investors who aren't a citizen of the country of establishment is called a Foreign Direct Investment. Irrespective of whether the business is newly established or an expansion of a preexisting business entity. As long has the investor has certain degree of influence or posses direct control or authority over the business. Foreign Direct investments differs from foreign portfolio investment based on the level of direct control the investor has on a foreign business. In portfolio investment, investors are only seen as shareholders who buys equity of foreign based companies.

lozanna [386] · Answer 2 · 2022-03-25T03:35:45+03:00

Answer:

Foreign direct investment (FDI)

Explanation:

Bric autos inc. a campora-based automobile company investing in the country of Bryon is an example of foreign direct investment.

Foreign direct investment (FDI): This can be defined as an investment made by a firm or individual in a particular country into a foreign country.

It could be due to expansion of a company to have branches in other countries.

Foreign direct investment refers to a business set up up by a foreigner in a foreign country.

FDI benefits both the investor and the host country. The investor's benefits could be in the form of subsidies or tax incentives while the host country benefits from increase in employment opportunities for their citizens, increase in the level of technology (due to the imported technology), economic development.

FDI is of a disadvantage to the host country because their local business will be displaced. The local business which is usually on a small scale will not have the resources to compete with FDI, so there is a a tendency of them folding-up.