A firm's direct investment in international business involves building a new plant or buying an existing plant in a foreign country to produce its own products, or it may involve buying an existing firm in a foreign country. A. TRUEB. FALSE

A firm's direct investment in international business involves building a new plant or buying an existing plant in a foreign country to produce its own products, or it may involve buying an existing firm in a foreign country-This statement is true

Explanation:

A foreign direct investment (FDI) can be defined as a company of one nation putting up a physical investment into building a facility (factory) in another country or involves buying an existing Plant in a foreign country.

Examples of foreign direct investments include mergers and acquisitions,

Strategically, FDI can be categorized into three types -

Horizontal - In case of horizontal FDI, the company carries or perform all the same activities abroad as it does at the home country.

For example: - Toyota assembles motor cars in Japan, India and the UK.

Vertical - In vertical assignments, different types of activities are carried out abroad.

Conglomerate - In this type of investment, the investment is made to acquire an unrelated business abroad. It symbolizes the entry of the company into an altogether different business line.