Question 1

A firm may cross-list its share to:

Accepted Answer

A)  establish a broader investor base for its stock. 
B)  establish name recognition in foreign capital markets, thus paving the way for the firm to source new equity and debt capital from investors in different markets. 
C)  expose the firm's name to a broader investor and consumer groups. 
D)  All of these. 
A)  establish a broader investor base for its stock. 
B)  establish name recognition in foreign capital markets, thus paving the way for the firm to source new equity and debt capital from investors in different markets. 
C)  expose the firm's name to a broader investor and consumer groups. 
D)  All of these.

Question 2

"Call market" and "crowd trading" take place on:

Accepted Answer

A)  a non-continuous exchange trading system. 
B)  a continuous trading exchange system. 
C)  non-continuous markets and continuous markets, respectively. 
D)  continuous markets and not in non-continuous markets, respectively. 
A)  a non-continuous exchange trading system. 
B)  a continuous trading exchange system. 
C)  non-continuous markets and continuous markets, respectively. 
D)  continuous markets and not in non-continuous markets, respectively.

Question 3

When deciding whether to cross-list shares on a foreign exchange, the firm has to consider the expected benefits and costs. The benefits may be: to establish a broader investor base for its stock, to establish name recognition in foreign capital markets, thus paving the way for the firm to source new equity and debt capital from investors in different markets, and to expose the firm's name to a broader investor and consumer groups. The costs include: listing fees, reconciliation of the accounting standards of two countries, compliance with the regulations of the foreign exchange, and investor relations.
-Assume that Accor shares are trading at A$2.5 in Sydney and $28 in New York.Each ADR equals 20 shares.The current exchange rate is A$1.5/$.In the absence of transaction costs,can you make an arbitrage profit?

Accepted Answer

Yes.Buy one ADR in New York fo

Question 4

Canadian stocks are cross-listed in the United States as:

Accepted Answer

A)  American depository receipts. 
B)  Global depository receipts. 
C)  Ordinary shares. 
D)  Global registered shares. 
A)  American depository receipts. 
B)  Global depository receipts. 
C)  Ordinary shares. 
D)  Global registered shares.

Question 5

A liquid stock market is one in which:

Accepted Answer

A)  investors can buy and sell shares quickly at close to the current quoted prices. 
B)  investors can buy shares quickly at close to the current quoted prices. 
C)  investors can sell shares quickly at close to the current quoted prices, 
D)  investors can buy and sell shares quickly above the current quoted prices. 
A)  investors can buy and sell shares quickly at close to the current quoted prices. 
B)  investors can buy shares quickly at close to the current quoted prices. 
C)  investors can sell shares quickly at close to the current quoted prices, 
D)  investors can buy and sell shares quickly above the current quoted prices.

Question 6

Factor that affects international equity returns is:

Accepted Answer

A)  macroeconomic variables that influence the overall economy. 
B)  exchange rate changes. 
C)  the industrial structure of the country. 
D)  all of these. 
A)  macroeconomic variables that influence the overall economy. 
B)  exchange rate changes. 
C)  the industrial structure of the country. 
D)  all of these.

Question 7

In the London market, Rolls Royce stock closed at £0.875 per share on Thursday, April 17, 2003. Rolls Royce trades as an ADR in the OTC in the United States. Five underlying Rolls Royce shares are packaged into one ADR. On April, 17, 2003, the British Pound sterling to the U.S. spot exchange rate was £0.6366/$1.00.
-Assume Nestle is trading for SF200 in Zurich and Nestle ADRs (4 ADRs per share)are trading for $40 on the New York Stock exchange.The current exchange rate is SF1/$ and a trader has $10,000 or the equivalent in SF.How can the trader make an arbitrage profit?

Accepted Answer

A)  Buy ADRs in Zurich and sell shares in New York. 
B)  Buy ADRs in New York and sell shares in Zurich. 
C)  Buy shares in Zurich and sell ADRs in New York. 
D)  Buy shares in New York and sell ADRs in Zurich. 
A)  Buy ADRs in Zurich and sell shares in New York. 
B)  Buy ADRs in New York and sell shares in Zurich. 
C)  Buy shares in Zurich and sell ADRs in New York. 
D)  Buy shares in New York and sell ADRs in Zurich.

Question 8

In the London market, Rolls Royce stock closed at £0.875 per share on Thursday, April 17, 2003. Rolls Royce trades as an ADR in the OTC in the United States. Five underlying Rolls Royce shares are packaged into one ADR. On April, 17, 2003, the British Pound sterling to the U.S. spot exchange rate was £0.6366/$1.00.
-Assume Nestle is trading for SF200 in Zurich and Nestle ADRs (4 ADRs per share)are trading for $40 on the New York Stock exchange.The current exchange rate is SF1/$ and a trader has $10,000 or the equivalent in SF.How much arbitrage profit can the trader make?

Accepted Answer

A)  $200 
B)  $1250 
C)  $2500 
D)  No profit can be made 
A)  $200 
B)  $1250 
C)  $2500 
D)  No profit can be made

A firm may cross-list its share to:

"Call market" and "crowd trading" take place on:

Canadian stocks are cross-listed in the United States as:

A liquid stock market is one in which:

Factor that affects international equity returns is:

Globalization and the Multinational Firm

International Monetary System

Balance of Payments

The Market for Foreign Exchange

International Parity Relationships and Forecasting Foreign Exchange Rates

International Banking and Money Market

International Bond Market

Futures and Options on Foreign Exchange

Interest Rate and Currency Swaps

International Portfolio Investment

Management of Economic Exposure

Management of Transaction Exposure

Management of Translation Exposure

Foreign Direct Investment and Cross-Border Acquisitions

International Capital Structure and the Cost of Capital

International Capital Budgeting

Multinational Cash Management

Exports and Imports

International Tax Environment

Corporate Governance Around the World

Filters

Exam 8: International Equity Markets

A firm may cross-list its share to:

"Call market" and "crowd trading" take place on:

Canadian stocks are cross-listed in the United States as:

A liquid stock market is one in which:

Factor that affects international equity returns is:

Globalization and the Multinational Firm

International Monetary System

Balance of Payments

The Market for Foreign Exchange

International Parity Relationships and Forecasting Foreign Exchange Rates

International Banking and Money Market

International Bond Market

Futures and Options on Foreign Exchange

Interest Rate and Currency Swaps

International Portfolio Investment

Management of Economic Exposure

Management of Transaction Exposure

Management of Translation Exposure

Foreign Direct Investment and Cross-Border Acquisitions

International Capital Structure and the Cost of Capital

International Capital Budgeting

Multinational Cash Management

Exports and Imports

International Tax Environment

Corporate Governance Around the World

Filters