5.T or F: American Depository Receipts (ADRs) are certificates that give foreign

Question

5.T or F: American Depository Receipts (ADRs) are certificates that give foreign stockholders a legal claim on U.S. companies' foreign stock.

10. A possible advantage to a rights offering is that
A.current shareholders are protected against dilution.
B.the firm has a built-in market of knowledgeable investors.
C.distribution costs are lower than a public offering.
D.All of these options are true.

14.American Depository Receipts (ADRs) are
A.receipts sent to foreign stockholders who own American companies.
B.proof of ownership for Eurodollar deposits held by Americans.
C.certificates that have a legal claim on an ownership interest in a foreign company's common stock.
D.certificates in U.S. companies that allow foreign investors to buy shares of American companies.

Explanation / Answer

T/F Question .......... False.

Foreign Share holders cannot have direct legal claim in stocks, they can claim their deposits from depository.

Question - 10 = D.All of these options are true.

Question - 14

Option - D. Certificates in U.S. companies that allow foreign investors to buy shares of American companies.

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