FIRST CONTACTS 28000 BCE 1821 CE
THE COLUMBIAN EXCHANGE
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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What were some of the risks of investing money into overseas colonies?
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Most ships did not complete the ocean voyage and investors lost their small share
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The colonists caught diseases from the Americas
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Investors shared the profits from the colonies when they thrived
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If the colony failed, investors lost their small share
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Explanation:
Detailed explanation-1: -The risks associated with direct foreign investment are business risk, financial risk, exchange rate risk, and political risk. Direct foreign investment has the additional risk factors of exchange rate and political risk compared to domestic investment.
Detailed explanation-2: -The Russian-Ukraine conflict is an extreme example of foreign investment risk. But foreign investment risk exists whenever an individual or entity dedicates capital to another country. Such risk can take place among even so-called “safe” countries.
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