Commercial Paper is a type of short-term borrowing where the borrower sells promissory notes that mature from two to 270 days. Although the CP must be paid at maturity, it is often “rolled”, the matured commercial paper is paid off with newly issued commercial paper. In this way, short-term debt may be extended for a longer period of time. Each issue of commercial paper may have a different interest rate.
LeoGlossary: Commercial Paper
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