Suppose IBM Decided to Issue Commercial Paper in Denominations of $5,000

question 92

Multiple Choice

Suppose IBM decided to issue commercial paper in denominations of $5,000 to raise a large sum of money. Since the commercial paper is secured only by IBM's reputation,

• A) IBM does not have to pay back the principal.
• B) IBM has to pay interest rates higher than those charged by commercial banks for short-term loans.
• C) no interest is paid.
• D) no collateral is involved.
• E) the commercial paper can be issued only in $1,500 or $10,000 denominations.

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Definitions:

Conjuncts

Components of a larger logical structure or statement that are joined together by a conjunction, each of which is necessary for the truth of the whole.

Main Connective

In logic, the operator (such as AND, OR, NOT) that determines the truth value of a complex sentence based on the truth values of its components.

Tautology

A statement or proposition that is true by necessity or by virtue of its logical form, often repeating the same idea in different words.

Main Connective

In a logical formula, the operator that holds the highest precedence, determining the formula's overall truth value.