Match the items of List-I with the items of List-II and choose the correct answer from the code given…
Direct investment overseas to manufacture unrelated products not produced at home (a) is Conglomerate FDI (iii); investing abroad to distribute or sell the firm's domestic…
Choose your answer
Match the items of List-I with the items of List-II and choose the correct answer from the code given below.
(a) Direct investment overseas aimed at manufacturing products not manufactured by the firm in the home country. — (i) Inward FDI
(b) Direct investment in a foreign country aimed to sell the output of the firm's domestic production. — (ii) Backward Vertical FDI
(c) Direct investment overseas aimed at providing inputs for the firm's production process in the home country. — (iii) Conglomerate FDI
(d) Foreign firms investing overseas and taking control over foreign assets. — (iv) Forward Vertical FDI
Answer and explanation
Correct answer D
Direct investment overseas to manufacture unrelated products not produced at home (a) is Conglomerate FDI (iii); investing abroad to distribute or sell the firm's domestic output (b) is Forward Vertical FDI (iv); investing overseas to extract or supply inputs for domestic production (c) is Backward Vertical FDI (ii); and foreign firms investing into a host economy to control local assets (d) represents Inward FDI (i).
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UGC NET Commerce