Many large U.S. firms invest abroad instead of exporting. Prior to beginning work on this assignment, read James Gerber’s (2017) Chapter 4 and Ed. Crooks’ article, America: Riveting Prospects
Compare and contrast foreign trade and foreign investment.
Evaluate why many U.S. companies do not want to participate in exporting and rather build their plants and factories in foreign countries to produce there.
Assess the advantages and disadvantages of this type of foreign investment (i.e., building their plants and factories and producing their products in foreign countries).
Analyze how foreign investment and production can contribute the U.S. economy when its transactions are not counted into GDP.
Explain whether you are in favor of foreign trade (exporting) or foreign investment (production outside the United States), and why.
Sample Solution
