Using any two of the four FDI theories [international product life cycle, market imperfections, eclectic, market power], explain why companies engage in foreign direct investment.
The FDI theory of international product life cycle holds that if he demands for a new product in other countries becomes significant; it becomes worthwhile for the innovating firm to set up production facilities in those countries. This leads to foreign direct investment. At the same time a firm may make ...
This solution gives you a detailed discussion on foreign direct investment