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Q44
(IAS/2010)
Economy › Money, Banking & Inflation › Central banking functions
Answer Verified
Which of the following is/are treated as artificial currency?
Result
Your answer:
—
·
Correct:
C
Explanation
Special Drawing Rights (SDRs) are explicitly described in IMF and textbook sources as an artificial currency unit or international reserve asset created in 1969 and used by the IMF for lending and as a unit of account, not traded as a normal foreign-exchange currency [3]. In contrast, American Depository Receipts (ADRs) and Global Depository Receipts (GDRs) are negotiable financial instruments issued by depository banks representing shares of foreign companies for trading in domestic or international markets; they are securities, not currencies [2]. Therefore only SDRs are treated as an artificial currency, while ADRs and GDRs are depository receipts (capital-market instruments).
Sources
- [1] Indian Economy, Nitin Singhania .(ed 2nd 2021-22) > Chapter 18: International Economic Institutions > CHAPTER SUMMARY > p. 553
- [3] Indian Economy, Nitin Singhania .(ed 2nd 2021-22) > Chapter 18: International Economic Institutions > SPECIAL DRAWING RIGHTS > p. 514
- [2] Indian Economy, Nitin Singhania .(ed 2nd 2021-22) > Chapter 16: Balance of Payments > b. Depository Receipt > p. 478
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