Question

Susan, a U.S. citizen, builds and operates a kennel in France. This action is an example of a. U.S. foreign portfolio investment and U.S. domestic investment. b. investment for Susan and U.S. foreign portfolio investment. c. U.S. foreign direct investment and U.S. domestic investment. d. investment for Susan and U.S. foreign direct investment.

Answer 1

Answer:

D

Explanation:

This is Susan's investment as well as US foreign direct investment

Foreign direct investment is basically an international investment in which the the individual investing which is Susan builds a lasting enterprise in another country. It normally tmeans individuals are buying or constructing a factory in a foreign country or adding improvements to such a facility, in the form of property, plants, or equipment.

Answer 2

b. Investment for Susan and U.S. foreign portfolio investment

Explanation:

Investment for Susan because it was built and operated by her. It is foreign portfolio investment because FPI is the entry of funds into a country where foreigners deposit money in a country's bank or make purchases in the country's stock and bond markets, sometimes for speculation

It is not Foreign Direct Investment (FDI) because is an investment in the form of a controlling ownership in a business in one country by an entity based in another country. It was not stated in the question that she based in US.