Answer the following statements true (T) or false (F)
1. Firms using commercial paper are generally required to maintain commercial bank lines of credit equal to the amount of the paper outstanding.
2. The commercial paper market is available to all New York Stock Exchange companies.
3. One major disadvantage of commercial paper is that if the company's credit quality declines, refinancing existing commercial paper might be impossible to achieve through a new issue of commercial paper.
4. Finance paper usually carries a higher rate of interest than direct paper.
5. Finance paper, unlike commercial paper, represents a long-term, unsecured promissory note.
1. TRUE
2. FALSE
3. TRUE
4. FALSE
5. FALSE
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