When FDI Occurs, What Are the Long­run Effects of FDI

Multiple Choice

When FDI occurs, what are the long­run effects of FDI
On industry output in the recipient nation?

A) There is no change in either the output of the capital­intensive or the labor­intensive industry.
B) The labor­intensive industry expands; the capital­ intensive industry contracts.
C) The capital­intensive industry expands; the labor­ intensive industry contracts.
D) Both capital­ and labor­intensive industries expand in the same proportion.