Consider the following:

Certificate of Deposit (CD)

Commercial Paper (CP)

Banker's Acceptance (BA)

Which of the above is/are money market instruments used for short-term financing?

Question

Certificate of Deposit (CD): A negotiable instrument issued by banks to raise short-term funds, typically maturing in less than a year. It offers higher interest rates than regular savings accounts.
Commercial Paper (CP): An unsecured, short-term debt instrument issued by corporations to finance their immediate expenses, typically maturing in 1 to 270 days. It is usually issued at a discount to face value.
Banker's Acceptance (BA): A short-term credit investment created by a bank to facilitate international trade; it is a promise that the bank will pay a specified amount at a future date, often used in export and import transactions.

GKToday Admin · Accepted Answer

1, 2 and 3

Certificate of Deposit (CD): A negotiable instrument issued by banks to raise short-term funds, typically maturing in less than a year. It offers higher interest rates than regular savings accounts.
Commercial Paper (CP): An unsecured, short-term debt instrument issued by corporations to finance their immediate expenses, typically maturing in 1 to 270 days. It is usually issued at a discount to face value.
Banker's Acceptance (BA): A short-term credit investment created by a bank to facilitate international trade; it is a promise that the bank will pay a specified amount at a future date, often used in export and import transactions.

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