Both Foreign Direct Investment (FDI) and Foreign Institutional Investor (FII) are related to investment in a country. Which one of the following statements best represents an important difference between the two?

Question

cdquestions Admin · Accepted Answer

The correct option is (B): FII helps in increasing capital availability in general, while FDI only targets specific sectors

Answer

FII helps bring better management skills and technology while FDI only bring capital

Answer

FII helps in increasing capital availability in general, while FDI only targets specific sectors

Answer

FDI flows only into secondary markets while FII targets primary markets

Answer

FII is considered to be more stable than FDI

List I (Aspects of International Trade)		List II (Characteristics)
A.	Multi-lateral Trade	I.	Trade is done by two countries with each other
B.	Volume of Trade	II.	The nature of goods and services imported and exported by countries
C.	Composition of Trade	III.	Trade is conducted with many trading countries
D.	Bilateral Trade	IV.	The total value of goods and services traded

Both Foreign Direct Investment (FDI) and Foreign Institutional Investor (FII) are related to investment in a country. Which one of the following statements best represents an important difference between the two?

The Correct Option is B

Solution and Explanation

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