Foreign Direct Investment (FDI) CDS Questions

CDS Economy

Foreign Direct Investment (FDI) MCQ Questions


1.
The term FDI stands for:
A.
Foreign Digital Investment
B.
Foreign Direct Investment
C.
Forced Direct Investment
D.
Free Domestic Investment
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ANSWER :
B. Foreign Direct Investment
2.
According to which international body's definition is FDI 'the category of international investment that reflects the objective of obtaining a lasting interest by a resident entity in one economy in an enterprise resident in another economy'?
A.
World Bank
B.
IMF (International Monetary Fund)
C.
WTO
D.
UNCTAD
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ANSWER :
B. IMF (International Monetary Fund)
3.
As per the RBI definition, FDI in a listed Indian company means investment in what minimum percentage of the post-issue paid-up equity capital (fully diluted basis)?
A.
5 percent
B.
10 percent
C.
15 percent
D.
26 percent
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ANSWER :
B. 10 percent
4.
Which of the following is NOT typically included in what FDI brings to a host country?
A.
New technology
B.
Skills and employment
C.
Short-term speculative portfolio gains
D.
New knowledge
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ANSWER :
C. Short-term speculative portfolio gains
5.
FDI is often perceived as a channel of progress and development mainly because it provides:
A.
Loans that must be repaid with interest
B.
Financial resources and technology
C.
Only foreign currency reserves
D.
Government subsidies
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ANSWER :
B. Financial resources and technology
6.
Greenfield FDI refers to:
A.
Acquiring an existing company in the host country
B.
Setting up entirely new facilities/operations from the ground up in the host country
C.
Buying shares on the stock market
D.
Lending money to a foreign government
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ANSWER :
B. Setting up entirely new facilities/operations from the ground up in the host country