. An American Depositary Receipt is defined as a security: A. that has been deposited in an interest-bearing account at a U.S. bank. B. issued outside the U.S. that represents shares of a U.S. stock. C. issued in the U.S. that represents shares of a foreign stock. D. that has a guarantee of payment from a U.S. bank. E. issued in multiple countries but denominated in U.S. currency.

. An American Depositary Receipt is defined as a security: A. that has been deposited in an interest-bearing account at a U.S. bank. B. issued outside the U.S. that represents shares of a U.S. stock. C. issued in the U.S. that represents shares of a foreign stock. D. that has a guarantee of payment from a U.S. bank. E. issued in multiple countries but denominated in U.S. currency.

International Financial Management

14th Edition

ISBN:9780357130698

Author:Madura

Publisher:Madura

Chapter3: International Financial Markets

Section: Chapter Questions

Problem 5QA

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An American Depositary Receipt (ADR) is defined as a security:(a) that has been deposited in an interest-bearing account at a U.S. bank(b) issued outside the U.S. that represents shares of a U.S. stock(c) issued in the U.S. that represents shares of a foreign stock(d) that has a guarantee of payment from a U.S. bank(e) issued in multiple countries but denominated in U.S. currency
Which of the following is a negotiable written promise (by a bank) for a U.S. dollar deposit at a bank located outside the United States or in U.S. International Banking Facilities.? a.Certificate of Deposits b.Bankers acceptances c.Eurodollar CD d.Repurchase agreement
__________________________________ is a negotiable CD for a U.S. dollar deposit at a bank located outside the United States or in U.S. International Banking Facilities. Select one: A. Repurchase Agreements B. Eurodollar CD C. Foreign Deposits D. Treasury Bill
Foreign currencies that are deposited in banks outside the home country are known as foreign bonds. Eurobond. Eurocurrencies. Eurodollars.
oreign currencies that are deposited in banks outside the home country are known as foreign bonds. Eurobond. Eurocurrencies. Eurodollars.
Identify the reasonsfor U.S. banks to operate in foreign countries and for foreignbanks to operate inthe United States.
Requiring a foreign banks to operate under the same rules as domestic banks is termed?
Which of the statement is incorrect? i) Eurobond is a bond issued by an international investor and sold to borrowers in countries with currencies other than the currency in which the bond is denominated. ii) Foreign bond is a bond issued in a host country’s financial market, in the host country’s currency, by a foreign borrower. iii) Eurobond is a bond issued by an international borrower and sold to investors in countries with currencies other than the currency in which the bond is denominated. iv) In contrast, a foreign bond is a bond issued in a host country’s financial market, in the foreign currency, by a foreign borrower.
1. Why don’t the additions and deductions from the bank balance on a bank reconciliation require adjustment by the company? 2. Do all transactions by U.S. companies with foreign parties require special accounting procedures by the U.S. companies? Explain.
In accounting for foreign currency transactions, which of the following approaches is used in the United States?a. One-transaction perspective; accrue foreign exchange gains and losses.b. One-transaction perspective; defer foreign exchange gains and losses.c. Two-transaction perspective; defer foreign exchange gains and losses.d. Two-transaction perspective; accrue foreign exchange gains and losses.
Foreign exchange risk arises when: A)business transactions are denominated in foreign currencies. B)sales are made to customers in a foreign country. C)goods or services are purchased from suppliers in a foreign country. D)accounting reports are prepared in a foreign currency.
Which foreign exchange risk relates to the value of assets held in foreign currency on the statement of financial position of financial institutions which trades? a. Economic risk b. Transaction type risk c. Currency risk d. Translation risk