Which of the following is most like a short-term collateralized loan?
A) Certificate of deposit
B) Repurchase agreement
C) Banker's acceptance
D) Commercial paper

Question

Quizplus · Accepted Answer

A repurchase agreement (also known as a repo) is a short-term collateralized loan where the borrower (usually a financial institution) sells securities to a lender (also usually a financial institution) with an agreement to repurchase them at a future date at a slightly higher price. This is similar to a short-term loan where the securities act as collateral.

Which of the Following Is Most Like a Short-Term Collateralized