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Which of the following is/are treated as artificial currency

Which of the following is/are treated as artificial currency?

(a)

ADR

(b)

GDR

(c)

SDR

(d)

Both ADR and SDR

Answer:

(c)

Core Books/NCERT

Explanation

The Special Drawing Right (SDR) is considered as an artificial currency. Therefore, the correct option is “SDR”. The SDR is a reserve asset created by the International Monetary Fund (IMF) to supplement the existing reserve assets of member countries. It is not a physical currency but a basket of currencies consisting of the US dollar, euro, Japanese yen, British pound sterling, and Chinese renminbi. ADR (American Depository Receipt) and GDR (Global Depository Receipt) are financial instruments that represent ownership in a foreign company`s stock. They are not considered as artificial currencies. ADRs are traded on US stock exchanges and denominated in US dollars, while GDRs are traded on international stock exchanges and denominated in a currency other than the issuer`s domestic currency.