1. Directions

You will read passages on the topic and then answer questions about them. You may find vocabulary at the end of the test. Read the questions carefully before choosing the correct answers.

2. Questions of the test

Question 1. What is one potential benefit of foreign investment?
A) The transfer of technology and management skills
B) The creation of new employment opportunities for local workers
C) The displacement of local workers
D) The loss of domestic control over strategic industries

Question 2. What is one potential downside of foreign investment?
A) The transfer of technology and management skills
B) The creation of new employment opportunities for local workers
C) The displacement of local workers
D) The loss of domestic control over strategic industries

Question 3. How can governments encourage foreign investment?
A) By offering tax incentives
B) By simplifying regulatory processes
C) By establishing regulations to protect domestic industries and workers
D) All of the above

Question 4. What is one way for governments to mitigate the negative impacts of foreign investment?
A) By offering tax incentives
B) By simplifying regulatory processes
C) By establishing regulations to protect domestic industries and workers
D) By negotiating favorable terms with foreign investors

Question 5. What is the main goal of foreign investment?
A) To transfer technology and management skills to the host country
B) To create new employment opportunities for local workers
C) To displace local workers
D) To maximize profits for the foreign company