CHAPTER 8 FOREIGN DIRECT INVESTMENT

1. Definition

1.1. occurs when a firm invests directly in facility to produce or market a product in a foreign country

1.2. once a firm undertakes FDI, it becomes a multinational enterprise

1.3. 2 forms

1.3.1. greenfield investment

1.3.1.1. establish new operation in a foriegn country

1.3.2. acquisition and merger

1.4. flow of FDI

1.4.1. the amount of FDI undertaken in a period of time

1.5. stock of FDI

1.5.1. the total of accumulated value of foreign-owned assets at a given time

1.6. outflows of FDI

1.7. inflows of FDI

2. Trend in FDI