Commercial paper is short-term,________ debt used by ________ that is usually a cheaper source of funds than a short-term bank loan.

Question

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Commercial paper is typically unsecured debt that is issued by large corporations as a means of obtaining short-term funding. Since commercial paper is unsecured, it typically has a higher interest rate than secured debt, such as a bank loan, but it is still often a cheaper source of funds for corporations. Choice A and C are incorrect because commercial paper is typically unsecured, not secured, and it is more commonly used by large corporations than small corporations. Choice B is incorrect because it suggests that commercial paper is issued by small corporations, which is not typically the case.

Commercial Paper Is Short-Term,________ Debt Used by ________ That Is

Commercial Paper Is Short-Term, Debt Used by That Is