Commercial paper:

A) is normally issued by smaller firms that require cash for less than 270 days.
B) is normally purchased by insurance companies and mutual funds that have excess funds to invest for a short period.
C) is considered very safe and pays interest rates slightly below 3-month treasuries.
D) requires SEC registration.
E) All of the above are correct regarding commercial paper.

Commercial Paper

An unsecured, short-term debt instrument issued by corporations, typically used for the financing of payroll, accounts payable, and inventories.

SEC Registration

The process of filing documents required by the Securities and Exchange Commission for new securities to be sold to the public.

Treasuries

Government debt securities issued by the United States Department of the Treasury to finance government spending as an alternative to taxation.