When issuing commercial paper,it is important for a company to have:
A) a party to act as an acceptor and guarantee payment.
B) collateral to attach to the issue.
C) a well-established reputation in the markets.
D) investors organised by the investment bankers to sell the issue.

Question

Quizplus · Accepted Answer

While having an acceptor or guarantor can increase investor confidence, it is not a requirement for issuing commercial paper. Collateral is also not necessary for this type of short-term financing. However, a company's reputation in the market is crucial for investors to be willing to buy their commercial paper. Option D may be helpful in facilitating the sale of the issue, but it is not a requirement.

When Issuing Commercial Paper,it Is Important for a Company to Have