Which of the following is an example of direct foreign investment?

a. exporting to a country.

b. establishing licensing arrangements in a country.

c. purchasing existing companies in a country.

d. investing directly (without brokers) in foreign stocks.

It is purchasing existing companies in a country (C)

Explanation:

Exporting to a country : this involved bringing in goods that have already been produced in the home country to another country to sell through distributors or foreign middle-men. This doesn't required direct capital investment rather it is just expanding the market reach.

Establishing licencing arrangements in a country : Here, licence is given to a foreign-based investor to operate using the company name. This is allowed after an agreed sum has been paid and necessary conditions have been fulfilled.

Purchasing existing companies in a country : This required direct investment of equity capital in a foreign based-company and the risk here is higher than other methods of foreign expansion.

Investing directly (without brokers) in foreign market : this is a type of foreign indirect investment in company's financial instruments.