Question

What is the primary difference between Foreign Direct Investment (FDI) and portfolio investment?

a.

FDI involves passive investment, while portfolio investment is active.

b.

FDI is made in financial assets, while portfolio investment is made in physical assets.

c.

FDI results in managerial control, while portfolio investment does not bring financial control.

d.

FDI and portfolio investment are synonymous terms.

Answer: (c).FDI results in managerial control, while portfolio investment does not bring financial control. Explanation:FDI results in managerial control over the operations of the foreign entity, while portfolio investment does not bring any financial control.

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Q. What is the primary difference between Foreign Direct Investment (FDI) and portfolio investment?

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