INTERNATIONAL

FINANCIAL
INSTRUMENTS
BY: HILAL AHMED
 Q1. Euro notes and Euro commercial papers
are:
A. SHORT-TERM INSTRUMENTS
B. UNSECURED PROMISSORY NOTES
C. THOSE THAT ARE UNDERWRITTEN, AS WELL AS
THOSE ARE NOT UNDERWRITTEN.
D. ALL OF THE ABOVE
 Q2. The bonds which are dominated in
currency other than the currency of the
country where the bonds are issued is called:
a. Euro bonds
b. Global bonds
c. Straight bonds
d. Cocktail bonds
e. all of the above
 Q3. Cocktail bonds can be:

A. Denominated in a mixture of currencies.

B. Represent a weighted average of 5
currencies.
C. Investors get currency diversification risk
D. ALL OF THE ABOVE ARE CORRECT
 Q3. Cocktail bonds can be:

A. Denominated in a mixture of currencies.

B. Represent a weighted average of 5
currencies.
C. Investors get currency diversification risk
D. ALL OF THE ABOVE ARE CORRECT
 Q4. WHICH ONE OF THE FOLLOWING IS
INCORRECT ABOUT American Depository
Receipts
A. Introduced by JP SMITH in 1927
B• A negotiable certificate issued by a U.S
bank
C• Represents a specified number of shares of
a foreign company
D• ADRs are denominated in U.S dollars.
 Q5. WHICH ONE OF THE FOLLOWING IS INCORRECT ABOUT Global
Depository Receipt (GDR)

A. Global Depository Receipt (GDR) - certificate issued by

international bank, which can be subject of worldwide circulation on
capital markets.
B. GDR's are emitted by banks, which purchase shares of foreign
companies and deposit it on the accounts.
C. Global Depository Receipt facilitates trade of shares, especially
those from emerging markets.
D. Prices of GDR's are often close to values of related shares.
E. ALL OF THE ABOVE ARE CORRECT
 Q6. WHICH OF THE FOLLOWING IS INCORRECT ABOUT DEPOSITORY RECEIPT-

A. A DR is a type of negotiable (transferable) financial security traded on a local

stock exchange but represents a security, usually in the form of equity, issued by
a foreign, publicly-listed company

B. DRs are created when a foreign company wishes to list its securities on another
country’s stock exchange.

C. One of the most common types of DRs is the American depository receipt
(ADR), which has been offering companies, investors and traders global
investment opportunities since the 1920s.

D. The most common type of DRs are European DRs and International DRs.

E. ALL OF THE ABOVE ARE CORRECT

THANK YOU