Explanation:
Explanation:
Option A is incorrect because commercial paper is an unsecured short-term debt instrument, meaning issuers are not required to pledge collateral.
Option B is correct. Credit rating agencies typically require issuers of commercial paper to secure a backup line of credit from banks to ensure liquidity and reduce default risk.
Option C is incorrect. While commercial paper is short-term, its maturities generally do not exceed 270 days, not two years.
Which of the following statements is most accurate regarding US commercial paper?
A
Involves the issuer pledging collateral as security.
B
Mandates the issuer to maintain a standby credit facility.
C
Features maturities extending up to two years.
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