Question

The problem with buying foreign stocks is that most foreign companies are not listed on any of the U.S. stock exchanges, so the purchase of shares is difficult. Intermediaries have found a way to solve this problem by selling A. foreign stock indexes. B. ETFs that include foreign stocks. C. ADRs D. stock in U.S. companies with international sales.

Answer 1

Answer:

C. ADRs

Explanation:

In principle both  B. ETFs that include foreign stocks. and C. ADRs are close options to this questions. US firms can buy foreign stock through ADRs i.e. American Depository Receipts. Another way could be through ETF but ETF will track the index of foreign stocks. However, it won't give the ownership of the stock. Hence ADR is a suitable option.