Which of the following is not a characteristic of commercial paper?
A) Issued by large prestigious firms.
B) One-to-two year maturity.
C) Rates are usually below prime rates on business loans.
D) Usually in denominations of $100,000 or more.

Question

Quizplus · Accepted Answer

Commercial paper can have maturities ranging from one day to 270 days, and it is typically issued by blue-chip companies with high credit ratings. The rates on commercial paper tend to be slightly below those on bank loans, and the minimum denomination is usually $100,000 or more. Therefore, option B is not a characteristic of commercial paper since it mentions a 1-2 year maturity, which may not be relevant to all commercial paper issuances.

Which of the Following Is Not a Characteristic of Commercial