Passlane Sign in

Ch.1 · Savings vs Investment Avenues · medium

A Commercial Paper (CP) is issued by:

0% of students got this wrong

EXPLANATION

Commercial Paper is an unsecured, short-term (7 days to 1 year) money market instrument issued by corporates and financial institutions to meet short-term funding needs. It is issued at a discount to face value.

A.The Reserve Bank of India to manage liquidity

B.Corporates and financial institutions as a short-term borrowing instrument [✓ Correct]

C.State governments to fund infrastructure projects

D.Scheduled commercial banks as an alternative to fixed deposits

EXPLANATION

Commercial Paper is an unsecured, short-term (7 days to 1 year) money market instrument issued by corporates and financial institutions to meet short-term funding needs. It is issued at a discount to face value.

Practising Chapter 1 one question at a time?

Try the full chapter — 50 questions, tracked score, weak area breakdown.

Practice Chapter 1 →Take the mock test →