IIM Sambhalpur International Finance

What is headroom in American Depository Receipts issuance

• The headroom in American Depository Receipts issuance is the amount of money set aside for marketing the ADRs
• The headroom in American Depository Receipts issuance is the space above the ceiling in the issuing company's office
• The headroom in American Depository Receipts issuance is the difference between the number of shares authorized for issuance and the number of shares actually issued.
• The headroom in American Depository Receipts issuance is the term used to describe the upper management team responsible for the ADR issuance

What is the most important risk for investor when they invest in American depository Receipts

• Market risk is the most important risk for investors when they invest in American depository Receipts.
• Liquidity risk is the most important risk for investors when they invest in American depository Receipts.
• Currency risk is the most important risk for investors when they invest in American depository Receipts.
• Credit risk is the most important risk for investors when they invest in American depository Receipts.

What is two way fungibility in Global depository receipts

• The ability to convert GDRs into cryptocurrency
• Two way fungibility in Global depository receipts refers to the ability to convert GDRs into underlying shares and vice versa.
• The ability to convert GDRs into real estate
• The ability to convert GDRs into art pieces

A sponsored American depository receipt (ADR) is:

• An ADR is a negotiable certificate issued by a U.S. bank representing a specified number of shares in a foreign stock traded on a U.S. exchange.
• A type of tax deduction for American investors
• A type of insurance for American stocks
• A type of currency used in American banks

An unsponsored American depository receipt (ADR) can be

• listed on the New York Stock Exchange
• traded on the London Stock Exchange
• traded on the over-the-counter (OTC) market
• available for purchase directly from the issuing company

Overseas acquisitions can be funded with ADRs only

• True
• Partially true
• Depends on the country
• False

Why QIB is better for domestic investors

• QIB is better for domestic investors because it offers access to a wider range of investment opportunities and allows for diversification of their portfolio.
• QIB is not better for domestic investors because it has higher fees and costs
• QIB is not better for domestic investors because it does not allow for portfolio diversification
• QIB is not better for domestic investors because it limits their investment options

Infosys has raised American depository receipts for the purpose of

• paying off its debts in the United States
• reducing its presence in the United States market
• acquiring a new technology company in the United States
• expanding its investor base in the United States

The firm has a headroom of 23% and its authorized capital is USD 12.5 million with face value of USD 1 . What is amount of ADR that can be raised

• USD 5,000,000
• USD 10,000,000
• USD 1,500,000
• USD 2,875,000

Tata Steel financed acquisitions of Corus steel thorough

• Tata Steel financed acquisitions of Corus Steel through a government bailout
• Tata Steel financed acquisitions of Corus Steel through a combination of debt and equity.
• Tata Steel financed acquisitions of Corus Steel through selling off its automotive division
• Tata Steel financed acquisitions of Corus Steel through cryptocurrency investments