ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Commercial paper is a short-term unsecured promissory note issued by large and creditworthy companies to raise short-term funds at lower rates of interest than market rates. The issuance of commercial paper is an alternative to bank borrowing for large companies that are generally considered to be financially strong.

Detailed explanation-2: -There are four types of commercial paper: promissory notes, drafts, checks, and certificates of deposit (CDs).

Detailed explanation-3: -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-4: -Meaning of Commercial Paper In India, commercial paper is a short-term unsecured promissory note issued by the Primary Dealers (PDs) and the All-India Financial Institutions (FIs) for a short period of 90 days to 364 days.

Detailed explanation-5: -It is a short-term debt instrument tool that is set for a maturity period. It is usually an unsecured debt where the company doesn’t pledge any asset but still qualifies for it based on their company’s liquidity, revenue-generating power, and achievements. More items