Which of the following is most likely to increase in value as the result of a weakening dollar?
A) an ADR for a foreign telecommunications company
B) stock in a firm that depends heavily on imported raw materials
C) stock in a firm with many accounts payable in foreign currencies
D) stock in a foreign company that depends heavily on exports to the U.S.

Question

Quizplus · Accepted Answer

An ADR (American Depositary Receipt) for a foreign telecommunications company is likely to increase in value as the result of a weakening dollar because the underlying foreign currency would strengthen relative to the dollar, making the ADR more valuable in dollar terms.

Which of the Following Is Most Likely to Increase in Value