Issuers of commercial paper usually maintain lines of credit with banks to back up their short-term financing needs.

Question

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Issuers of commercial paper typically establish backup lines of credit with banks to ensure that they can meet their short-term financing obligations if necessary. This helps to reduce the risk of default on the commercial paper, which can help to make it a more attractive investment for buyers.

Issuers of Commercial Paper Usually Maintain Lines of Credit with Banks