Question

Ali Baba joint stock company is one of the famous creditworthy business which are producing different products to the UK market.  The company recently wants to coverage the Asian market and decides to expand their business in new hi-tech machine. Since the investment is large, it requires long- term finance. The company decide to raise funds by issuing equity share. The equity shares involve huge floatation costs. To meet the expenses of floatation cost the company decides to tap the money market.

Name the money market instrument the company can use for the above purpose?

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Answer 1

Ali Baba's founder :- Jack Ma

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Answer 2

Answer:

) Commercial paper can be used by Ganesh Steel Ltd. It is a promissory note which is negotiable and transferable. It is primarily used by large and credit worthy companies for bridge financing. In other words, it is used as an alternative to borrowings from bank and capital market.