What term describes an agreement between two or more companies to share a foreign direct investment?

• A. Offshoring
• B. Turnkey Operation
• C. Joint Venture
• D. Outsourcing

Answer: (C)

Joint ventures describe two or more companies forming a new entity to share ownership, control, profits, and risks of a foreign direct investment. This arrangement lets partners pool resources, knowledge, and local market access to pursue opportunities abroad that might be harder to tackle alone.

Offshoring refers to moving production or services to another country, but it doesn’t require creating a shared ownership entity. A turnkey operation is a completed project where a provider designs and builds a facility for someone else to operate, without forming a jointly owned company. Outsourcing means contracting out work to another firm while maintaining ownership, rather than creating a new jointly owned enterprise.