Foreign Direct Investment (FDI) Quiz

True or false: Inward flow of FDI refers to domestic investment directed outward to foreign markets outside the home country.

True or false: Outward stock of FDI represents the total accumulated value of a country's direct investment in other countries over time.

True or false: Potential benefits of FDI for the host economy include decreased productivity and competitiveness.

True or false: Technology transfer and knowledge spillovers are potential benefits of FDI for the host economy.

True or false: Inward stock of FDI represents the total accumulated value of foreign direct investment in a specific country over a specific period of time.

Foreign Direct Investment (FDI)

Inward Flow of FDI: Foreign direct investment coming into a country from external sources.
Outward Flow of FDI: Domestic investment directed outward to foreign markets outside the home country.
Inward Stock of FDI: Total accumulated value of foreign direct investment in a specific country over time.
Outward Stock of FDI: Total accumulated value of a country's direct investment in other countries over time.

Benefits of FDI for the Host Economy

Employment Generation: FDI creates new job opportunities in the host country.
Technology Transfer and Knowledge Spillovers: FDI brings in new technologies, skills, and expertise, contributing to knowledge spillovers.
Economic Growth and Development: FDI stimulates economic growth and development by increasing capital investment and output.
Increased Productivity and Competitiveness: FDI leads to increased productivity and competitiveness in the host country.
Access to New Markets and Global Networks: FDI provides access to new markets and global networks, enhancing the host country's trade connections.

Costs of FDI for the Host Economy

Potential Negative Consequences: FDI may lead to job displacement, exploitation of natural resources, and cultural homogenization in the host country.

Test your knowledge of Foreign Direct Investment (FDI) with this quiz. Learn about the concepts of inward and outward flow of FDI, as well as the inward and outward stock of FDI. By understanding these terms, you can gain insights into the global investment landscape.