Question : Commercial papers are short-term debt instruments issued by:
Option 1: Banks
Option 2: Central banks
Option 3: Corporations
Option 4: Mutual funds
Correct Answer: Corporations
Solution : The correct answer is (c) Corporations.
Commercial papers are short-term debt instruments issued by corporations to meet their short-term funding needs. They are unsecured promissory notes with a fixed maturity, typically ranging from a few days to a year. Commercial papers are typically issued by large, creditworthy corporations to raise funds from investors in the money market.
Question : Statement 1: Treasury bills are short-term debt instruments issued by the government.
Statement 2: Treasury bills are long-term loans provided by commercial banks.
Option 1: Statement 1 is true, and statement 2 is true.
Option 2: Statement 1 is true, but statement 2 is false.
Option 3: Statement 1 is false, and statement 2 is true.
Option 4: Statement 1 is false, and statement 2 is false.
Regular exam updates, QnA, Predictors, College Applications & E-books now on your Mobile