BACHELOR OF BUSINESS ADMINISTRATION

Detailed explanation-1: -“Payee”.-The person named in the instrument, to whom or to whose order the money is by the instrument directed to be paid, is called the “payee”.

Detailed explanation-2: -Commercial paper is an unsecured form of promissory note that pays a fixed rate of interest. It is typically issued by large banks or corporations to cover short-term receivables and meet short-term financial obligations, such as funding for a new project.

Detailed explanation-3: -The main issuers of commercial paper are finance companies and banks, but also include corporations with strong credit, and even foreign corporations and sovereign issuers. The main buyers of commercial paper are mutual funds, banks, insurance companies, and pension funds.

Detailed explanation-4: -A commercial paper, which is made payable only to a named person, is called. Order paper. A written order by one person directing another to pay a sum of money to a third person is known as. Bill of exchange.

Detailed explanation-5: -The two basic types of commercial paper are drafts and notes. The note is a two-party instrument whereby one person (maker) promises to pay money to a second person (payee). The draft is a three-party instrument whereby one person (drawer) directs a second (drawee) to pay money to the third (payee).