Exam 15: Sourcing Equity Globally

Empirical evidence shows that new issues of equity by domestic firms in the U.S. market typically has a ________ stock price reaction and new equity issues in the U.S. markets by foreign firms with segmented domestic markets have a ________ stock price reaction.

Strategic alliances are normally formed by firms that expect to gain synergies from which of the following?

A ________ is defined as one that is targeted at investors in a single country and underwritten in whole or part by investment institutions from that country.

Level I ADRs trade primarily

ADRs that are created at the request of a foreign firm wanting its shares traded in the United States are ________.

By cross listing and selling its shares on a foreign stock exchange a firm typically tries to accomplish which of the following?

The stock exchange with the greatest value of shares traded is ________.

Depositary receipts traded outside the United States are called ________ depositary receipts.

The number of foreign firms traded on the London exchange is ________ than the number traded on the NYSE, and the costs of listing and disclosure in London are ________ those for the NYSE.

In addition to gaining liquidity, which of the following could also be considered a legitimate reason for cross-listing equity?

Private equity funds (PEF)differ from traditional venture capital (VC)funds in that

What are the two schools of thought regarding the worldwide trend toward increased financial disclosure by publicly traded firms. Explain which school of thought you hold to and why.

Level ________ is the easiest standard to satisfy for issuing ADRs.

Who pays the costs of creating a sponsored ADR?

Investment banking services include which of the following?

Your authors note several empirical studies that have found

According to the U.S. school of thought, the worldwide trend toward fuller and more standardized disclosure rules should ________ the cost of equity capital.

An unsponsored ADR may be initiated without the approval of the foreign firm with the underlying stock.

Which of the following were NOT identified by the authors as an alternative instrument to source equity in global markets?

Level II ADRs must meet