Equity Investments Q159

159Martha comes across the following two statements while checking her students’ examination papers.

Statement I: The only disadvantage of a global depository receipt is that it is subject to capital flow restrictions.

Statement II: Sponsored depository receipts provide the investors with voting rights while unsponsored depository receipts do not.

Which of the following statements is most accurate?

Option : B
Explanation : Global depository receipts are not subject to capital flow restrictions. Therefore statement I is incorrect. Statement II is correct.

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