According to the OLI paradigm, foreign direct investment is explained by three conditions (ownership advantages, location advantages and internalization). Q1: Examine the factors that influence firms to locate subsidiaries close to markets. Q2: Managers of multinational enterprises are advised to take advantage of their home region institutions such as the European Union. Assume you are the manager of a multinational enterprise in Belgium. Why is the institutional framework created by the EU pivotal for business? Q3: Identify firms' strategic responses that managers adopt in order to deal with foreign currency exchange rate movements