Question

Can anyone answer the question and explain it thx alot

15. Suppose the U.S. government imposes added taxes on interest paid on American bank deposits. What is the likely effect of this regulation? a) raise Eurodollar interest rates b) reduce Eurodollar interest rates c) have no effect d) capital flight 16. Which of the following foreign equity securities are sold by foreign companies to U.S. investors? a) Yankee stock issues b) Shogun stock issues c) Samurai stock issues d) Global stock issues 17. These are ordinary shares of a non-U.S. company listed and traded in the same form on any market in the world. They are known as a) global shares b) Yankee stock issues c) Samurai bonds d) exchange traded funds

Answer 1

You have asked so many unrelated questions in the same post. I have addressed the first four. Please post the balance questions separately.

Q - 15

The correct answer is the option b) reduce Eurodollar interest rates

Since interest on the domestic deposits are taxed, the $ will move out of the US to foreign countries. Such transactions are called Euro dollar. Since foreign markets will see excess Euro dollars, the Eurodollar interest rates will fall.

Q - 16

The correct answer is the option a) Yankee stock issues

These are the issues made by foreign companies in USA and hence sold to USA investors

Q - 17

The correct answer is the option a) global shares

This is because, global shares trade on multiple exchanges with different currencies.

Q - 18

The correct answer is the option b) reduced government ownership of private firms

Reduction of government ownership of private firms will add to freedom, flexibility and efficiency of private firms. International markets will reward this.