Exams › SSC CGL (Prelims) › General

Choose the correct option regarding Statement 1 and Statement 2: Statement 1: Foreign Direct Investment (FDI) involves management control. Statement 2: Foreign Portfolio Investment (FPI) involves the purchase of securities.

1. Only Statement 1 is correct
2. Only Statement 2 is correct
3. Both Statement 1 and Statement 2 are correct
4. Neither Statement 1 nor Statement 2 is correct

Correct answer: Both Statement 1 and Statement 2 are correct

Solution

FDI generally gives the investor management control or a significant degree of influence in the enterprise. FPI refers to investment in financial securities such as shares and bonds, so both statements are correct.

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