The yield on commercial paper is generally higher than the yield on ________.
A) preferred stock
B) a corporate bond
C) common stock
D) a Treasury bill

Question

Quizplus · Accepted Answer

Treasury bills are considered to be the safest investment in the market and therefore have the lowest yield. Commercial paper is a short-term debt instrument that typically has a higher yield than a Treasury bill due to the higher risk associated with the issuers of commercial paper. Preferred stock and common stock are equity investments and do not have a yield in the same way that debt investments do. Corporate bonds can have a higher yield than commercial paper depending on the creditworthiness of the issuer and the length of the bond's maturity.

The Yield on Commercial Paper Is Generally Higher Than the Yield