T/F If firms from country A undertake $20 billion of FDI in firms from country B in year 1, and another $20 billion in year 2, t

Question

2 years ago

5

T/F If firms from country A undertake $20 billion of FDI in firms from country B in year 1, and another $20 billion in year 2, t

hen we can say that in each of those two years, B receives annual FDI outflows of $20 billion, and A generates annual FDI inflows of $20 billion.

Business

1 answer:

pogonyaev · Answer 1 · 2022-10-18T07:02:13+03:00

Answer: False

Explanation:

In both the first and second years, firms in country A undertook FDI projects of $20 billion in country B. This means that Country A had FDI outflows of $20 billion in those two years not inflows. Inflows are what happens when the FDI is coming into the country.

Country B on the other hand, was receiving money from country A. Country B therefore had FDI inflows of $20 billion in each of the two years and not outflows like Country A had.