Compare the flow (in the most recent year) and stock of FDI from your country in China versus the flow and stock of FDI from China in your country. Which is bigger?

Foreign Direct Investment refers to investments that citizens or businesses of a country make in another country by either investing or acquiring businesses in the other country.

In 2019, FDI from China to the USA was estimated to be $37.7 billion.

In the same year, FDI from the USA to China was estimated to be $116.2 billion.

FDI from the US to China is therefore bigger than FDI from China to the US.

Dr Cash 1,166,400

Cr Notes Receivable 1,000,000

Cr Interest Revenue 166,400

Explanation:

To determine the net amount of the notes receivable that will be recorded, we must determine the present value of the note:

present value = 1,166,400 / (1 + 8%)² = 1,166,400 / 1.1664 = 1,000,000