1. For each of the following, indicate 1) if the transaction is a foreign direct investment or a foreign portfolio investment and 2) how the transaction would affect the U.S. net capital outflow (increases or decreases).
a. A Czech Republic cellular phone company establishes an office in the U.S., Ceteris Paribus.
b. Harrod's of London sells stock to the General Electric pension fund, Ceteris Paribus.
c. Honda expands its factory in Marysville, Ohio, Ceteris Paribus.
d. Your U.S. based mutual fund buys stock in Eastern European companies, Ceteris Paribus.
e. Europe changes its tax laws so that Europeans buy stock in U.S. firms, Ceteris Paribus.
f. A U.S. citizen buys stock in companies located in Japan, Ceteris Paribus.
g. A Polish company opens a shipbuilding plant in the U. S., Ceteris Paribus.