Which of the following is the main motivation for companies to engage in Foreign Direct Investment (FDI)?

CA Foundation · Business Economics · MTP · January 2025
Which of the following is the main motivation for companies to engage in Foreign Direct Investment (FDI)?
(A) A. To reduce foreign competition in domestic markets
(B) B. To gain access to new markets and resources
(C) C. To avoid taxes in the home country
(D) D. To lower labour costs by outsourcing to developing countries

Suggested Answer and Working Notes:

Correct Answer: Option (B)

B. To gain access to new markets and resources

Topics: International Trade

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