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FDI Finance

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Organizations seeking domestic and foreign investments through importing and exporting must
create best practices in the best interest of profitability, survivability, and auditory compliance.
In addition to foreign market analysis and the reduction of risk associated ventures in direct
foreign investments, organizations must create best practices for minimizing risk associated with
taxes relating to importing and exporting tariffs. One strategy that many companies utilize is the
constructive building of manufacturing plants within the country that they intend on exporting
too, for example, Australian-based organizations made by agricultural land within the United
States to simply avoid paying tariffs taxes. Effectively gaining access to low labor costs is by far
another strategic move for many organization, thus, the cut costs and maximize profitability,
some companies will move overseas strictly to employ cost-effective human resources. Lastly,
many US based companies have moved overseas and built facilities and factories to save on the
exorbitant amount of production costs that is produced annually (O'Brian, 2010, pp. 272-274).
Reference
O'Brian, R. G. (2010). Multinational Firms. In R. G. O'Brian, Microeconomics (pp. 272-274).
Upper Saddle River, NJ: Prentice Hall.

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