Economics 9708 · AS & A Level · Globalisation

Globalisation — practice question

Which criticism of foreign direct investment (FDI) is the least justified?

  • AIt encourages competition, reduces prices and forces the less efficient domestic firms to leave the market.
  • BIt brings workers from its own country and provides only low paying jobs to low skilled local workers.
  • CIt is usually withdrawn quickly in case of a global crisis, making developing countries more vulnerable to global shocks.
  • DIts actions often result in environmental degradation, and over exploitation of natural resources.

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