Q. Which one of the following best defines net foreign direct investment (FDI)?

[A] Total foreign investment in a country

[B] Difference between inflows and outflows of foreign direct investment

[C] Total domestic investment in a country

[D] Difference between imports and exports of goods and services

Answer: B
Notes:

Explanation – Net foreign direct investment (FDI) is calculated by subtracting the value of outward (or outflows) FDI from the value of inward (or inflows) FDI. This provides an overall picture of whether a country is attracting more foreign investments than it is investing abroad, or vice versa. A positive net FDI indicates that a country receives more foreign investments than it invests overseas, while a negative net FDI means that a country invests more abroad than it receives in foreign investments.

Source: The Hindu

Blog
Academy
Community