Option S

 

a) When a country is newly founded and/or less economically developed, FDI is critical for success. A less developed country (LEDC) no only lacks the ability to produce products on as large a scale as developed countries, but it also–in most cases–is unable to produce as effectively due to lack of trained workers, experience, and technology. This means that the country is almost guaranteed to massively import products until such a time when it capable of competing with the rest of the world market. Unfortunately, LEDCs also tend to have weak currencies that make buying large quantities of products very difficult. Within a short period of time, the need to import drives the country into debt. Without FDI, the country will be unable to pull itself up to the world level. FDI is often withheld until disaster or potential is shown, but only when currency begins to flow into a country can it develop.