Question : Case Study 17:
JKL Inc. is a startup in the education sector aiming to raise funds for developing online learning platforms.
Question :
To raise short-term funds for marketing its online learning platforms, which money market instrument might JKL Inc. use?
Option 1: Corporate bond
Option 2: Call money
Option 3: Commercial paper
Option 4: Treasury bill
Correct Answer: Commercial paper
Solution : The correct answer is (c) Commercial paper.
Commercial paper is a short-term, unsecured debt instrument issued by corporations, typically with maturities ranging from a few days to a year. It is a common choice for businesses seeking short-term funds to finance various operational needs, including marketing initiatives. In summary, commercial paper offers JKL Inc. a swift and cost-effective means of raising short-term funds for marketing its online learning platforms, aligning well with their needs for timely financial support in this context.
Question : Case Study 23:
GHI Inc. is a technology startup looking to raise funds for its expansion into new markets.
To raise short-term funds for marketing its products in new markets, which money market instrument might GHI Inc. use?
Option 1: Debenture
Option 3: Corporate bond
Option 4: Commercial paper
Regular exam updates, QnA, Predictors, College Applications & E-books now on your Mobile