Certificates of Ownership Issued by a U

question 22

Multiple Choice

Certificates of ownership issued by a U.S.bank that represent indirect ownership of a certain number of shares of a specific foreign firm on deposit in a bank in the firm's home country are known as:

• A) American Depository Receipts (ADRs)
• B) Exchange Traded Funds (ETFs)
• C) Warrants
• D) Options
• E) Futures

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Definitions:

Ordinary Income

Income earned from providing services or the sale of goods, including wages, salaries, tips, and interest, which is taxed at the standard rates.

Liquidation

Liquidation is the process of bringing a business to an end and distributing its assets to claimants, often occurring when a company is insolvent.

Partner's Interest

This refers to the ownership share or equity a partner holds in a partnership, representing their portion of the profits, losses, and capital.

Guaranteed Payment

Payments made to a partner within a partnership that are made without regard to the partnership's income and are guaranteed for services or use of capital.