Which of the following is true? Group of answer choices a. Non-U.S. firms may desire to issue bonds in the U.S. due to less regulations in the U.S. b. U.S. firms may desire to issue bonds in the U.S. due to less regulations in the U.S. c. U.S. firms may desire to issue bonds in the non-U.S. markets due to less regulations in non-U.S. countries. d. A and B

Which of the following is true? Group of answer choices a. Non-U.S. firms may desire to issue bonds in the U.S. due to less regulations in the U.S. b. U.S. firms may desire to issue bonds in the U.S. due to less regulations in the U.S. c. U.S. firms may desire to issue bonds in the non-U.S. markets due to less regulations in non-U.S. countries. d. A and B

International Financial Management

14th Edition

ISBN:9780357130698

Author:Madura

Publisher:Madura

Chapter18: Long-term Debt Financing

Section: Chapter Questions

Problem 1QA

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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.
. Which of the following is incorrect? Country credit risk spread is the difference between yields of international bonds of the country and government bonds of the developed country (generally US. Credit default swap (CDS) is a derivative product which provides the buyer to grantee to be paid back face value of a bond by credit default swap issuer in case the borrower does not pay. In general, a Eurobond of developing country or company interest rate is smaller than sum of same maturity of US bond rate and country of company credit default swap rate point (CDS premium /10000). In general, a company or county Eurobond's primary market sale is done by a syndicated group (banks and other financial intuitions). If the US dollar index (USDX) increases, we expect depreciation of any other currency against the USD.
Critically discuss the differences between foreign bonds and Eurobonds and elaborate on the reasons why the Eurobonds dominate the international bond market.
The term foreign bond market refers to trading in: A. issues sold in the borrower's country in a currency of another country. B. none of the above. C. issues sold in one country and currency by a borrower from another country. D. issues sold in one country in a currency of another country by a borrower from another country.
In general, MNCs probably prefer to use ____ foreign debt when their foreign subsidiaries are subject to ____ local interest rates. Group of answer choices more; low more; high less; low B and C none of these
National governments issue debt securities known as sovereign bonds, which can be denominated in either local currency or global reserve currencies, like the U.S. dollar or euro. (source (Links to an external site.)Links to an external site.). For this discussion question, first define what these bonds are. Why are these issued? Then discuss the issues that can arise when investors invest in these types of bonds. What are the advantages and disadvantages of these bonds? Are there unique issues that can arise only with this type of bond? Would you invest in sovereign bonds?
Which one of the following is a Eurobond? A euro-denominated issued by a South Korean firm sold in the US A US dollar-denominated bond issued by a German firm sold in the US A US dollar-denominated bond issued by a German firm sold in Germany A US dollar-denominated bond issued by a South Korean firm sold in Canada
National governments issue debt securities known as sovereign bonds, which can be denominated in either local currency or global reserve currencies, like the U.S. dollar or euro. For this discussion question, first define what these bonds are. Why are these issued? Then discuss the issues that can arise when investors invest in these types of bonds. What are the advantages and disadvantages of these bonds? Are there unique issues that can arise only with this type of bond? Would you invest in sovereign bonds?
Which of the following facilitates trading of short term corporate bonds in an economy? Select one: A. Capital Market B. All of the given options C. Money Market D. Foreign Exchange Market
a) What is the difference between a Foreign Bond and a Eurobond? Explain you answer with examples. b) Define Equity, Debt and Derivative. c) Describe the main types of non-bank Financial Institutions (FI). Give two examples of non-bank FI’s that are allowed to accept deposits.
Select all of the following correct statements regarding Eurobonds and Foreign Bonds: Group of answer choices An example of a Eurobond would be if Bayer AG, a German corporation, issues EUR-denominated debt in Germany. An example of a foreign bond would be if Bayer AG, a German corporation, issues USD-denominated debt in Germany. An example of a foreign bond would be if Bayer AG, a German corporation, issues USD-denominated debt in the United States. An example of a Eurobond would be if Bayer AG, a German corporation, issues USD-denominated debt in Germany.
Sovereign debt (issued bonds) are typically considered as proxies for risk free. 1. Discuss the reasons why sovereign debt may not be risk free. 2. Why might credit ratings agencies give different credit ratings to sovereign debt issued by the same country, depending on coupons denominated in domestic or foreign currency.