Which of the following statements about Eurodollar deposits is correct?
A) Eurodollar deposits can only be dealt by banks in the USA
B) US withholding tax applies to Eurodollar deposits
C) Eurodollar deposits are free of US reserve requirements
D) Eurodollar deposits are subject to US exchange controls

Question

Quizplus · Accepted Answer

Eurodollar deposits are US dollar denominated deposits held in banks outside the USA, typically in Europe. As they are held outside the USA, they are not subject to US reserve requirements or US exchange controls. US withholding tax may still apply to Eurodollar deposits, but this depends on the individual circumstances of the depositor.

Which of the Following Statements About Eurodollar Deposits Is Correct