The promissory notes issued by company for short term fund raising are unsecured are classified as _____________?
Correct answer: D. commercial paper
- A. unsecured notes
- B. debt paper
- C. term paper
- D. commercial paper
Explanation
Commercial paper consists of unsecured promissory notes issued by companies to obtain short-term financing. Its unsecured nature distinguishes it from secured debt instruments.
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Business finance explains how organisations plan, obtain and use money while balancing risk, return and liquidity. Topics include financial statements, time value of money, budgeting, working capital, capital structure, sources of finance, investment appraisal and cost of capital. Capital budgeting evaluates long-term projects, whereas working capital manages day-to-day operations.
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