Commercial paper that is sold without going through a broker or dealer is known as
A) direct paper.
B) dealer paper.
C) book-entry transactions.
D) term paper.

Question

Quizplus · Accepted Answer

Direct paper is commercial paper that is sold directly to investors without the need for a broker or dealer in the transaction. This allows issuers to avoid underwriting fees and potentially offer lower interest rates to investors. Therefore, A is the correct choice as it is the direct paper described in the prompt. B refers to commercial paper sold through dealers, C refers to a method of recording stock ownership, and D is not a relevant term in this context.

Commercial Paper That Is Sold Without Going Through a Broker