Business Discussion Questions - Essay Example

Consequently, it will miss some of the income it would have earned from the international market. At the same time, it is imperative to note that a firm that ventures into a market when it should not is likely to register losses, predominantly because the market may be hostile towards its operations thereby averting it from accomplishing its business goals. #Question 2What are the critical economic/business issues relevant to foreign direct investment?DiscussionSome of the critical economic issues relevant to foreign direct investment includeThe GDP of the nation.

The GDP per capita. The rate of GDP growth inflation rate.

The rate of unemployment. The fiscal policies enacted within the nation monetary PoliciesThe income distribution within the country. The country’s policies regulate foreign trade and investment. The labor lawsTax regulations.

Question 3Are political risk and political instability the same?
ExplainDiscussionPolitical risk simply refers to any form of threat that the returns from an investment can register as a consequence of the alterations in the political dynamics within a specific nation. On the other hand, political instability denotes the likelihood of the operations within a specific nation being disrupted for political reasons (Hill, 2014). Such disturbances include demonstrations by the citizens of the nation, an attempted or successful coup as well as the eruption of violence among other events.