The following is an outline of certain potential benefits as well as costs associated with the cross-border listings of stocks: (i)the company can expand its potential investor base
(ii)issues involving the disclosure and listing requirements
(iii)creates a secondary market for the company's shares
(iv)volatility spillover from the overseas markets
(v)liquidity
(vi)control of the company by foreigners
(vii)enhances the visibility of the company's name and its products in foreign marketplaces
Which of the following represent all the potential benefits of the cross-border listings of stocks?
A)(i),(ii),and (iii)
B)(ii),(iv),and (vi)
C)(i),(iii),(v),and (vii)
D)(iv),(v),(vi),and (vii)

Question

Quizplus · Accepted Answer

The potential benefits of cross-border listings of stocks include expanding the investor base (i), creating a secondary market (iii), increasing liquidity (v), and enhancing visibility in foreign marketplaces (vii). The issues involving disclosure and listing requirements (ii) are a potential cost, but not a benefit. Control of the company by foreigners (vi) is also a potential cost, not a benefit. Volatility spillover from overseas markets (iv) is not necessarily a benefit, and in fact, could be a potential cost. Therefore, the best choice is C, as it includes all the potential benefits.

The Following Is an Outline of Certain Potential Benefits as Well