Foreign Investments
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Discuss and explain why managers make foreign investments? What are the benefits and risks involved in this? Give examples. Response is 150 words
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Solution Summary
This solution explains the benefits of foreign investment and risks associated with it.
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As you may know, the bottom line in any business is profit maximization. Foreign investments focus on maximizing returns and minimizing risks. Generally, when production cost and wages are high domestically, firms will move to countries/invest in countries with lower labour costs. A good example is Nike Inc.'s operations in China.
"Foreign direct ...
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