國際金融學(xué)練習(xí)題：Lecture 9

Chapter13InternationalEquityMarkets

True/FalseQuestions

1.

Inadealermarket,thebrokertakesthetradethroughthedealer,whoparticipatesintradesasaprincipalbybuyingandsellingthesecurityforhisownaccount.

True

False

2.

Publictradersdonottradedirectlywithoneanotherinadealermarket.

True

False

MultipleChoiceQuestions

3.

Thesaleofnewcommonstockbycorporationstoinitialinvestorsoccursin

A.

theprimarymarket.

B.

thesecondarymarket.

C.

theOTCmarket.

D.

thedealermarket.

4.

Thesaleofpreviouslyissuedcommonstocktradedbetweeninvestorsoccursin

A.

theprimarymarket.

B.

thesecondarymarket.

C.

theon-the-runmarket.

D.

thedealermarket.

5.

A"primary"stockmarketis

A.

abiginternationally-importantmarketliketheNYSE.

B.

amarketwherecorporationsissuenewsharestoinitialinvestors.

C.

wherebrokersandmarketmakerstrade.

D.

noneoftheabove

6.

Themarketcapitalizationofthedevelopedworld

A.

isabout90percentofthemarketcapitalizationoftheentireworld.

B.

isabout80percentofthemarketcapitalizationoftheentireworld.

C.

isabout70percentofthemarketcapitalizationoftheentireworld.

D.

isabout60percentofthemarketcapitalizationoftheentireworld.

7.

Themarketcapitalizationofthedevelopingworld

A.

isabout80percentofthemarketcapitalizationoftheentireworld.

B.

isabout60percentofthemarketcapitalizationoftheentireworld.

C.

isabout40percentofthemarketcapitalizationoftheentireworld.

D.

isabout20percentofthemarketcapitalizationoftheentireworld.

8.

Ingeneral,Standard&Poor'sEmergingMarketsDataBaseclassifiedastockmarketas"emerging"if

A.

itislocatedinalow-ormiddle-incomeeconomyasdefinedbytheWorldBank.

B.

itsinvestablemarketcapitalizationislowrelativetoitsmostrecentGNIfigures.

C.

eithera)orb)

D.

noneoftheabove

9.

Investmentinforeignequitymarkets

A.

isnolongerconsidereda"backwater"inthefieldofFinance.

B.

becamecommonpracticeinthe1980sasinvestorsdiversifiedtheirportfolios.

C.

duringthe1980swaslargelyconfinedtothedevelopedworld.

D.

alloftheabove

10.

Duringthe1980s,cross-borderequityinvestmentwaslargelyconfined

A.

totheequitymarketsofdevelopedcountries.

B.

totheemergingequitymarkets.

C.

totheequitymarketsoftheformerSovietUnion.

D.

noneoftheabove

11.

Inmutualfunds,investmentinemergingforeignequitymarkets

A.

representslessthanonepercentofinvestmentsinU.S.-basedmutualfunds.

B.

representsaboutfivepercentofinvestmentsinU.S.-basedmutualfunds.

C.

representsmorethantwentypercentofinvestmentsinU.S.-basedmutualfunds.

D.

declinedduringthe1990s.

12.

Onlyinthe_______didworldinvestorsstarttoinvestsizableamountsintheemergingequitymarkets,astheeconomicgrowthandprospectsofthedevelopingcountriesimproved.

A.

1960s

B.

1970s

C.

1980s

D.

1990s

13.

Whichinvestmentislikelytobethemostliquid?

A.

AshareofpubliclytradedcompanytradingontheNYSE.

B.

AbondissuedbyaFortune500company.

C.

Ahouseinanicepartoftown.

D.

a)andb)areequallyliquid

14.

Whichinvestmentislikelytobetheleastliquid?

A.

AshareofpubliclytradedcompanytradingontheNYSE.

B.

AbondissuedbyaFortune500company.

C.

Ahouseinanicepartoftown.

D.

a)andb)areequallyliquid

15.

Aliquidstockmarket

A.

isoneinwhichpricesreflectallrelevantinformationquickly.

B.

isoneinwhichpricesreflectallpubliclyavailableinformationquickly.

C.

isoneinwhichpricesreflectpriceandvolumeinformationquickly.

D.

isoneinwhichinvestorscanbuyandsellstocksquicklyatclosetothecurrentquotedprices.

16.

Ameasureofliquidityforastockmarketistheturnoverratio;definedas

A.

theratioofstockmarkettransactionsoveraperiodoftimedividedbythesize,ormarketcapitalization,ofthestockmarket.

B.

theratioofthesize,ormarketcapitalization,ofthestockmarketdividedbythevalueofthestockmarkettransactionsoveraperiodoftime.

C.

theratioofaggregatecompanysalesoveraperiodoftimedividedbythesize,ormarketcapitalization,ofthestockmarket.

D.

noneoftheabove

17.

Generally,thehighertheturnoverratio,

A.

thelessliquidthesecondarystockmarket,indicatingeaseintrading.

B.

themoreliquidthesecondarystockmarket,indicatingeaseintrading.

C.

themoreliquidtheprimarystockmarket,indicatingeaseintrading.

D.

themoreefficientthestockmarketis.

18.

Theturnoverratiopercentagesfor27equitymarketsofdevelopedcountriesforthefiveyearsbeginningwith2002weremeasured.Mostnationalequitymarketshadveryhighturnoverratios,withthegreatmajorityinexcessof

A.

15percentturnoverperyear.

B.

25percentturnoverperyear.

C.

50percentturnoverperyear.

D.

75percentturnoverperyear.

19.

Theturnoverratiopercentagesfor36equitymarketsofemergingmarketsforthefiveyearsbeginningwith2002weremeasured.Manyofthesmallequitymarketsineachregion(e.g.,Peru,Venezuela,SriLanka,SlovakRepublic,Croatia,andZimbabwe)haverelativelylowturnoverratios,

A.

indicatingpoorliquidityatpresent.

B.

indicatinggoodliquidityatpresent.

C.

indicatingstronginvestmentperformanceovertheperiod.

D.

noneoftheabove

20.

Ameasureof"liquidity"forastockmarketis

A.

thetimesinterestearnedratio.

B.

theratioofstockmarkettransactionsoveraperiodoftimedividedbythesize,ormarketcapitalization,ofthestockmarket.

C.

theLIBORrate.

D.

botha)andb)

21.

Asameasureof"liquidity",

A.

generally,thelowertheturnover,thegreatertheliquidityofasecondarystockmarket.

B.

generally,thehighertheturnover,thegreatertheliquidityofasecondarystockmarket.

C.

themoreafinancialassetgurgleswhenshookthegreatertheliquidity.

D.

noneoftheabove

22.

Generally,thelowertheturnoverratio,

A.

thelessliquidthesecondarystockmarket,indicatingdifficultyintrading.

B.

themoreliquidthesecondarystockmarket,indicatingdifficultyintrading.

C.

themoreliquidtheprimarystockmarket,indicatingdifficultyintrading.

D.

themoreefficientthestockmarketis.

23.

Manyofthesmallforeignequitymarkets(e.g.Chile,SriLanka)

A.

havepoorliquidityatpresent.

B.

areveryliquidstockmarkets,sincethepoorpeoplelivingthereareeagertoselltheirsecurities.

C.

havefairlyhighturnoverratiosindicatingstrongliquidity.

D.

noneoftheabove

24.

Ingeneralifaninvestment

A.

haspoorliquidityitshouldofferinvestorsaliquiditypremium.

B.

canbesoldfairlyquicklyatafairprice,ithasgoodliquidity.

C.

botha)andb)

D.

noneoftheabove

25.

Manyofthelargeremergingequitymarkets(e.g.Korea,India)

A.

havepoorliquidityatpresent.

B.

aremoreliquidstockmarketsthanthedevelopedworld,sincethepoorpeoplelivinginthedevelopingworldareeagertoselltheirsecurities.

C.

havehighturnoverratios.

D.

noneoftheabove

26.

Inwhichtypeofmarketcanliquidity"dryup"?

A.

Abullmarket

B.

Abearmarket

C.

Aspeculativebubble

D.

Afinancialpanic

27.

InwhichtypeofpolicyactionsbytheFedcanliquidity"dryup"?

A.

Easymoney

B.

Tightmoney

C.

Decreaseinthereserverequirement

D.

Decreaseinthediscountrate

28.

Thesmallertheconcentrationpercentage,

A.

themoreconcentratedamarketisinafewstockissues.

B.

thelessconcentratedamarketis.

C.

themoreliquidthesecondarystockmarketis.

D.

noneoftheabove

29.

Overthelastfewyears,turnoverratiosinmanyemergingmarketsremainedlowandmarketconcentrationratiosremainedhigh,indicating

A.

thatinvestmentopportunitiesinthesemarketshavebeenimproving.

B.

thatinvestmentopportunitiesinthesemarketshavenotbeenimproving.

C.

thatinvestmentopportunitiesinthesemarketsareabouttoimprove.

D.

noneoftheabove

30.

In2002,24stockmarketshadconcentrationratiosof40percentormore,16had50percentormore,and6had60percentormore.Bycomparison,in2006,27stockmarketshadconcentrationratiosof40percentormore,21had50percentormore,and11had60percentormore.Thus,onemustconclude

A.

thatthenumberofequityinvestmentopportunitiesinmajorstockmarketsindevelopedcountrieshasnotbeenimprovinginrecentyears.

B.

thatthenumberofequityinvestmentopportunitiesinemergingstockmarketsindevelopingcountrieshasbeenimprovinginrecentyears.

C.

thatthenumberofequityinvestmentopportunitiesinemergingstockmarketsindevelopingcountrieshasnotbeenimprovinginrecentyears.

D.

noneoftheabove

31.

Themoreconcentratedanationalstockmarketis

A.

thegreateropportunityaglobalinvestorhastoincludesharesfromthatcountyinaninternationallydiversifiedportfolio.

B.

thelessopportunityaglobalinvestorhastoincludesharesfromthatcountyinaninternationallydiversifiedportfolio.

C.

thebroadertheinvestorbaseacrossanumberofdifferentsharesandindustries.

D.

noneoftheabove

32.

Thesecondarystockmarkets

A.

arethemarketsfor"pre-owned"or"used"sharesofstock

B.

providemarketabilitytoshares.

C.

providepricediscoveryorsharevaluation.

D.

alloftheabove

33.

Thesecondaryequitymarketsoftheworldservetwomajorpurposes.Theyprovide

A.

marketabilityandsharevaluation.

B.

liquidityandpricesupport.

C.

pricediscoveryandarbitrage.

D.

safetyandstability.

34.

Pricediscoveryinthesecondarystockmarkets

A.

occursduetothecompetitivetradingbetweenbuyersandsellers,justlikeoneBay.

B.

issetonceadayattheclose.

C.

issetbytheinvestmentbankersattheIPO.

D.

alloftheabove

35.

Anall-or-noneorderisalimitordereithertobuyortosellasecurityinwhichthebrokerisdirectedtoattempttofilltheentireamountoftheorderornoneofit.Anall-or-noneorderdiffersfromafill-or-killorderinthat

A.

withanall-or-noneorderimmediateexecutionisnotrequired.

B.

withanall-or-noneorderimmediateexecutionisrequired.

C.

withanall-or-noneorderoversubscriptionisallowed—fillingtheorderformoreshares.

D.

noneoftheabove

36.

Amarketorder

A.

isaninstructionfromacustomertoabrokertobuyorsellatthebestpriceavailablewhentheorderisreceived(immediately).

B.

isaninstructionfromacustomertoabrokertobuyorsellinaparticularmarket(e.g.NYSE).

C.

isalwaysandeverywhere"fillorkill".

D.

isalwaysandeverywhere"goodtillcancelled".

37.

Alimitorder

A.

isaninstructionfromacustomertoabrokertobuyorsellinataparticularprice(orbetter).

B.

canbea"dayorder"—thatistheorderiscancelledifnotexecutedduringthatday'strading.

C.

canbe"goodtillcancelled".

D.

alloftheabove

38.

Astop-limitorderisanordertobuyorsellastockthatcombinesthefeaturesofastoporderandalimitorder.Oncethestoppriceistouchedinthemarket,thestop-limitorderbecomesalimitordertobuyortosellatthelimitprice.Whichofthefollowingaretrue?

A.

Thebenefitofastop-limitorderisthattheinvestorcancontrolthepriceatwhichthetradewillgetexecuted.

B.

Astop-limitordermaynevergetfilledifthestock'spriceneverreachesthespecifiedlimitprice.Thismayhappenespeciallyinfast-movingmarketswherepricesfluctuatewildly.

C.

Theuseofstoplimitordersismuchmorefrequentforstocksthattradeonanexchangethanintheover-the-counter(OTC)market.

D.

Inaddition,yourbroker-dealermaynotallowyoutoplaceastoplimitorderonsomesecuritiesoracceptastoplimitorderforOTCstocks.

E.

Alloftheabovearetrue

39.

Whichofthefollowingaretrue?

A.

Unlessyougiveyourbrokerspecificinstructionstothecontrary,orderstobuyorsellastockaredayorders.

B.

Ordersthathavebeenplacedbutnotexecutedduringregulartradinghourswillautomaticallycarryoverintoafter-hourstradingbutnotthenextregulartradingday.

C.

Similarly,dayordersplacedduringafter-hourstradingwillautomaticallycarryoverintothenextregulartradingday.

D.

Ifyourorderisnotexecutedduringatradingsession,youarenotallowedtoplaceaneworderinthenexttradingsession.

E.

Alloftheabovearetrue

40.

Astoporderisanordertobuyorsellastockoncethepriceofthestockreachesaspecifiedprice,knownasthestopprice.Whenthespecifiedpriceisreached,yourstoporderbecomes

A.

amarketorder.

B.

agood-til-cancelled(GTC)order.

C.

adayorder.

D.

noneoftheabove

41.

Unlikedayorders,agood-til-cancelled(GTC)orderisanordertobuyorsellasecurityataspecificorlimitpricethatlastsuntiltheorderiscompletedorcancelled.Whichofthefollowingaretrue?

A.

AGTCorderwillnotbeexecuteduntilthelimitpricehasbeenreached,regardlessofhowmanydaysorweeksitmighttake.

B.

InvestorsoftenuseGTCorderstosetalimitpricethatisfarawayfromthecurrentmarketprice.

C.

SomebrokeragefirmsmaylimitthetimeaGTCordercanremainineffectandmaychargemoreforexecutingthistypeoforder.

D.

Alloftheabovearetrue

42.

Toavoidbuyingastockatapricehigherthanyourintention,youneedtoplace________ratherthanamarketorder.

A.

stop-lossorder

B.

adayorder

C.

agood-til-cancelledorder

D.

alimitorder

43.

Astoporderisanordertobuyorsellastockoncethepriceofthestockreachesaspecifiedprice,knownas

A.

thestopprice.

B.

thelimitprice.

C.

thelastprice.

D.

thesellprice.

44.

Theadvantagesofamarketorderincludethefactthat

A.

youareprettymuchguaranteedthatyourorderwillbeexecuted(assumingthattherearewillingbuyersandsellers).

B.

amarketordertypicallyhaslowercommissionsthanalimitorder.

C.

marketordersincreaseyourliquidity.

D.

botha)andb)

45.

Astoporderisanordertobuyorsellastockoncethepriceofthestockreachesaspecifiedprice,knownasthestopprice.Whenthespecifiedpriceisreached,yourstoporderbecomesamarketorder,Theadvantageofastoporderis

A.

youdon'thavetomonitorhowastockisperformingonadailybasis.

B.

thestoppricecanbeactivatedbyashort-termfluctuationinastock'sprice.

C.

onceyourstoppriceisreached,yourstoporderbecomesamarketorderandthepriceyoureceivemaybemuchdifferentfromthestopprice,especiallyinafast-movingmarketwherestockpricescanchangerapidly.

D.

alloftheaboveareadvantages

46.

DealersinanOTCmarket

A.

standreadytobuyatthebidandsellattheaskprice.

B.

settheirownbidandaskprices.

C.

donotchargecommissions.

D.

alloftheabove

47.

TheOTCmarket

A.

doesnotacceptcredit—thedealers"onlytakecash".

B.

isadealermarket.

C.

includestheNASDAQintheU.S.

D.

bothb)andc)

48.

A"specialist"

A.

makesamarketbyholdinganinventoryofaparticularsecurity,likeIBMorIntel.

B.

isaparticipantontheflooroftheexchange,liketheNYSE.

C.

hasadesignatedstationontheflooroftheexchange.

D.

alloftheabove

49.

AcrowdoffloortradersontheNYSE

A.

mayarriveatamorefavorablepricefortheirclients"inside"thespecialist'sbidandaskquotes.

B.

areobligedtoexecutetheirtradesthroughaspecialist.

C.

areallowedto"frontrun"theirowntradesaheadofcustomertrades.

D.

alloftheabove

50.

AspecialistontheNYSE

A.

isobligedtofilllimitordersiftheyaremorefavorablethanthespecialist'spostedbidandaskquotes.

B.

isobligedtofilllimitordersatthespecialist'spostedbidandaskquotes.

C.

isactuallyacomputerprogram,notahuman.

D.

botha)andc)

51.

A"callmarket"

A.

isOTCandover-the-phone.

B.

featuresanagentoftheexchangethataccumulatesabatchofordersthatareperiodicallyexecutedbywrittenorverbalauctionthroughouttheday.

C.

providestraderswithexecutionatcertainprices.

D.

bothb)andc)

52.

TheTorontoStockexchange

A.

isfullyautomated.

B.

featureselectronicmatchingofpublicorders.

C.

hascontinuousorderflow.

D.

alloftheabove

53.

Inanagencymarket,thebrokertakestheclient'sorderthroughtheagent,whomatchesitwithanotherpublicorder.Theagentcanbeviewedas

A.

adealer.

B.

aspecialist.

C.

abroker'sbroker.

D.

noneoftheabove

54.

Inanagencymarket,thebrokertakestheclient'sorderthroughtheagent,whomatchesitwithanotherpublicorder.Namesfortheagentare

A.

officialbroker.

B.

centralbroker.

C.

abroker'sbroker.

D.

alloftheabove

55.

TheParisBoursewastraditionallyacallmarket.Inacallmarket,anagentoftheexchangeaccumulates,overaperiodoftime,abatchofordersthatareperiodicallyexecutedbywrittenorverbalauctionthroughoutthetradingday.Bothmarketandlimitordersarehandledinthisway.Themajordisadvantageofacallmarketisthat

A.

tradersarenotcertainaboutthepriceatwhichtheirorderswilltransactbecausebidandaskquotationsarenotavailablepriortothecall.

B.

tradersarenotcertainabouthowmanyshareswillbeabletosellorbuyatthepricetheyquotebecauseordervolumeisnotavailablepriortothecall.

C.

thereisalackofliquidityintercall.

D.

noneoftheabove

56.

Atypeofnoncontinuousexchangetradingsystemiscrowdtrading.

A.

Unlikeacallmarketinwhichthereisacommonpriceforalltrades,severalbilateraltradesmaytakeplaceatdifferentpricesincrowdtrading.

B.

Unlikeacontinuousmarketinwhichthereisacommonpriceforalltrades,severalbilateraltradesmaytakeplaceatdifferentprices.

C.

Unlikeacallmarketinwhichseveralbilateraltradesmaytakeplaceatdifferentpricesthereisacommonpriceforalltradesinacallmarket.

D.

Noneoftheabove

57.

Whichtypeoftradingsystemisdesirableforactivelytradedissues?

A.

Continuoustradingsystems

B.

Calltradingsystems

C.

Crowdtradingsystems

D.

Noneoftheabove

58.

Callmarketsandcrowdtradingofferadvantagesfor__________becausetheymitigatethepossibilityofsparseorderflowovershorttimeperiods.

A.

thinlytradedissues

B.

activelytradedissues

C.

stocksbutnotbonds

D.

Noneoftheabove

59.

Theover-the-counter(OTC)marketisadealermarket.AlmostallOTCstockstradeontheNationalAssociationofSecurityDealersAutomatedQuotationSystem(NASDAQ),whichisacomputer-linkedsystemthatshows

A.

thelimitordersofallavailablecounterparties.

B.

thelastpriceatwhichasecuritywassold.

C.

thebid(buy)andask(sell)pricesofalldealersinasecurity.

D.

thebid(sell)andask(buy)pricesofalldealersinasecurity.

60.

OntheNYSE,limitorderpricesreceivepreferenceinestablishingthepostedbidandaskpricesiftheyaremorefavorablethanthespecialist's.Therefore

A.

aspecialistmustfillalimitorder,ifpossible,fromhisownaccountbeforetradingtheflowofpublicorders.

B.

specialistsmustfillalimitorder,ifpossible,fromtheflowofpublicordersbeforetradingforhisownaccount.

C.

aspecialistmustchangehispostedbidandaskpricestoreflecttheavailablelimitorders.

61.

ThelargeexchangemarketsintheUnitedStatesare

A.

agencymarkets.

B.

callmarkets.

C.

auctionmarkets.

D.

agency/auctionmarkets.

62.

"Callmarket"and"crowdtrading"takeplaceon

A.

anon-continuousexchangetradingsystem.

B.

acontinuoustradingexchangesystem.

C.

non-continuousmarketsandcontinuousmarkets,respectively.

D.

continuousmarketsandnon-continuousmarkets,respectively.

63.

Comparingagencyversusdealermarkets,whichcombinationofthefollowingstatementsistrue?

(i)-Ina"dealermarket,"thebrokertakestheclient'sorderthroughtheagent,whomatchesitwithanotherpublicorder.

(ii)-Inan"agencymarket,"thebrokertakesthetradethroughthedealer,whoparticipatesintradesasaprincipalbybuyingandsellingthesecurityforhisownaccount.

(iii)-Inan"agencymarket,"thebrokertakestheclient'sorderthroughtheagent,whomatchesitwithanotherpublicorder.

(iv)-Ina"dealermarket,"thebrokertakesthetradethroughthedealer,whoparticipatesintradesasaprincipalbybuyingandsellingthesecurityforhisownaccount.

(v)-Anagentcanbeviewedasa"broker'sbroker."

(vi)-Adealercanbeviewedasa"broker'sbroker."

A.

(i),(ii),and(v)

B.

(i),(ii),and(vi)

C.

(iii),(iv),and(v)

D.

(iii),(iv),and(vi)

64.

Amarket-valueindex

A.

iscalculatedsuchthattheproportionoftheindexastockrepresentsisdeterminedbyitsproportionofthetotalmarketcapitalizationofallstocksintheindex.

B.

iscalculatedastheaveragepriceofallthestocksintheindexthattradethatday,oneexampleistheNASDAQ.

C.

iscalculatedliketheDJIA.

D.

noneoftheabove

65.

TransactionsinsharesoftheiSharesFundswilltypicallygeneratetaxconsequences.Thisisbecause

A.

iSharesFundsareobligedtodistributeportfoliogainstoshareholders.

B.

iSharesFundsarenotallowedtobeheldintax-qualifiedaccountssuchasIRAs.

C.

iSharesFundsfeaturedailyresettlement.

D.

noneoftheabove

66.

iSharesMSCIare

A.

exchangetradedfundsthataresubjecttoU.S.SECandIRSdiversificationrequirements.

B.

open-endmutualfundssoldOTC.

C.

exchangetradedfundsthatareNOTsubjecttoU.S.SECandIRSdiversificationrequirements.

D.

noneoftheabove

67.

Afirmmaycross-listitsshareto

A.

establishabroaderinvestorbaseforitsstock.

B.

establishnamerecognitioninforeigncapitalmarkets,thuspavingthewayforthefirmtosourcenewequityanddebtcapitalfrominvestorsindifferentmarkets.

C.

exposethefirm'snametoabroaderinvestorandconsumergroups.

D.

alloftheabove

68.

StockinDaimlerAG,thefamousGermanautomobilemanufacturertradesonboththeFrankfurtStockExchangeinGermanyandontheNewYorkStockExchange.OntheFrankfurtbourse,Daimlerclosedatapriceof€54.34onWednesday,March5,2008.Onthesameday,DaimlerclosedinNewYorkat$83.55pershare.Topreventarbitragetradingbetweenthetwoexchanges,thesharesshouldtradeatthesamepricewhenadjustedfortheexchangerate.The$/€exchangerateonMarch5was$1.5203/€1.00.Thus,€54.34$1.5203/€=$82.61,whiletheclosingpriceinNewYorkwas$83.55.Thedifferenceiseasilyexplainablebythefactthat

A.

transactionscostsexceededthepricedifference,sonoarbitragewaspossibleevenformarketmakers.

B.

noonenoticedthearbitragethatday,butinadayorsotheopeningpricewilladjust.

C.

theNewYorkmarketclosesseveralhoursaftertheFrankfurtexchange,andthusmarketpricesorexchangerateshadchangedslightly.

D.

noneoftheabove

69.

Companiesdomiciledincountrieswithweakinvestorprotectioncanreduceagencycostsbetweenshareholdersandmanagement

A.

bymovingtoabettercounty.

B.

bylistingtheirstocksincountrieswithstronginvestorprotection.

C.

byvoluntarilycomplyingwiththeprovisionsoftheU.S.Sarbanes-OxleyAct.

D.

havingapressconferenceandpromisingtobenicetotheirinvestors.

70.

Benetton,anItalianclothier,islistedontheNewYorkStockExchange.

A.

ThisdecisionprovidestheirshareholderswithahigherdegreeofprotectionthanisavailableinItaly.

B.

Thisdecisioncanbeasignalofthecompany'scommitmenttoshareholderrights.

C.

ThismaymakeinvestorsbothinItalyandabroadmorewillingtoprovidecapitalandtoincreasethevalueofthepre-existingshares.

D.

Alloftheabove

71.

"Yankee"stockofferingsare

A.

sharesinforeigncompaniesoriginallysoldtoU.S.investors.

B.

dollar-denominatedsharesinforeigncompaniesoriginallysoldtoU.S.investors.

C.

U.S.stocksheldabroad.

D.

noneoftheabove

72.

Whichfactorsfuelthesaleof"Yankee"stockofferings?

A.

PrivatizationbymanyLatinAmericanandEasternEuropeangovernment-ownedcompanies.

B.

Therapidgrowthintheeconomiesofthedevelopingworld.

C.

TheexpectedlargedemandfornewcapitalbyMexicancompaniesnowthatNAFTAhasbeenapproved.

D.

Alloftheabove

73.

WhichfactorsappeartobefuelingthesaleofYankeestocks?

A.

ThepushforprivatizationbymanyLatinAmericanandEasternEuropeangovernment-ownedcompanies.

B.

Therapidgrowthintheeconomiesofthedevelopingcountries.

C.

ThelargedemandfornewcapitalbyMexicancompaniesfollowingapprovaloftheNorthAmericanFreeTradeAgreement.

D.

Alloftheabove

74.

Followingmonetaryunionandtheadventoftheeuro:

A.

ThecountriesoftheEuropeanunionhaveenactedcommonsecuritiesregulation.

B.

Apan-EuropeanstockexchangehasdevelopedinLondon,similartotheNYSEinscopeandtradingpractices.

C.

Developmentofacommonsecuritiesregulations,evenamongthecountriesoftheEuropeanUnion,hasnotasyetoccurred.

D.

Noneoftheabove

75.

TheEuropeanStockExchange,comparableinvolumetotheNYSE

A.

islocatedinMilan.

B.

islocatedinLondon.

C.

islocatedinFrankfurt.

D.

noneoftheabove

76.

ThefirstADRsbegantrading________asameansofeliminatingsomeoftherisks,delays,inconveniences,andexpensesoftradingtheactualshares.

A.

in1997

B.

in1987

C.

in1977

D.

in1927

77.

AmericanDepositoryReceipt(ADRs)representforeignstocks

A.

denominatedinU.S.dollarsthattradeonEuropeanstockexchanges.

B.

denominatedinU.S.dollarsthattradeonaU.S.stockexchange.

C.

denominatedinaforeigncurrencythattradeonaU.S.stockexchange.

D.

non-registered(bearer)securities.

78.

Yankeestocks

A.

oftentradeasADRsandhavehigherrisksthantradingtheactualshares.

B.

oftentradeasADRsandhavelowerrisksthantradingtheactualshares.

C.

arebankreceiptsrepresentingamultipleofforeignsharesdepositedinaU.S.bank.

D.

bothb)andc)

79.

ADRs

A.

areAmericanDepositoryReceipts.

B.

denominatedinU.S.dollarsthattradeonaU.S.stockexchange.

C.

aredepositoryreceiptsforforeignstocksheldbytheU.S.depository'scustodian.

D.

alloftheabove

80.

SponsoredADRs

A.

arecreatedbyabankattherequestoftheforeigncompanythatissuedtheunderlyingsecurity.

B.

cantradeontheNASDAQ.

C.

cantradeontheNYSE.

D.

alloftheabove

81.

ADRtrades

A.

clearinthreedays,justliketradesinU.S.shares.

B.

settleonlyafterthetradeintheunderlyingstocksclear,whichcantaketimedependingontheclearingpracticesofthenationalmarket.

C.

arepriceinthecurrencyoftheunderlyingsecurity.

D.

alloftheabove

82.

OntheParisbourse,sharesofAvionelletradeat€45.Thespotexchangerateis$1.40=€1.00.Whatistheno-arbitrageU.S.dollarpriceofanA