RBI Grade B Officer (General / DEPR / DSIM) 2022 · Question 255 of 276

- Read the passage given below and answer the following questions. Commercial paper is an unsecured, short-term loan taken by a corporation, typically for financing accounts receivable and inventory. It is usually issued at a discount, reflecting current market interest rates. It is also called unsecured promissory note since this issuer makes a promise to pay back the face value after the maturity period, but that promise is unsecured in the sense there is no guarantee that your money will come back. For the most part, commercial paper is a very safe investment because the financial situation of a company can easily be predicted over a few months. Furthermore, typically only companies with high credit ratings and credit worthiness issue commercial paper. (This is a recreated passage and not the exact one asked in the exam) Commercial Paper can be issued for a maximum duration of ____________ days?

Financial Markets

1. AA. 366 Days
2. BB. 365 DaysCorrect
3. CC. 150 Days
4. DD. 225 Days
5. EE. None of the above