The Goodknight Company Has Issued Securities with 45 Days to Maturity.What

question 96

Multiple Choice

The Goodknight Company has issued securities with 45 days to maturity.What type of security has it issued?

• A)Commercial Paper
• B)Banker's Acceptance
• C)Corporate Bond
• D)Treasury Bonds
• E)Municipal Bond

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Definitions:

Prospectus

A document disclosing the details of a security and the underlying business to prospective investors.

Indenture

Contractual agreements associated with bonds that limit the activities of the issuing companies. The limitations are designed to reduce the risk that the firm won’t be able to pay the bond’s interest and principal.

Issue New Securities

The process by which a company or other entity offers new stocks or bonds for sale to investors to raise capital.

Investment Banks

Financial institutions that provide services such as underwriting, acting as intermediaries in mergers and acquisitions, and providing financial advisory services to companies.