Which of the Following Is Not True Regarding ADRs

question 91

Multiple Choice

Which of the following is not true regarding ADRs?

• A) ADRs are denominated in the currency of the stock's home country.
• B) ADRs enable U.S. investors to avoid cross-border transactions
• C) ADRs allow non-U.S. firms to tap into U.S. market for funds.
• D) ADRs sometimes allow for arbitrage opportunities.

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Definitions:

Fiduciary Duty

A legal obligation of one party to act in the best interest of another when entrusted with care of money, property, or sensitive information.

Duty of Diligence

An obligation to exercise reasonable care and diligence in the performance of obligations, typically referring to the conduct expected of directors, officers, and professionals.

Conflict of Interest

A situation where an individual's personal interests could interfere with their professional duties or responsibilities.

RMBCA

The Revised Model Business Corporation Act, which provides a model framework for the governance of corporations, intended to standardize corporate law across jurisdictions.