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Business Paper
Source:
Encyclopedia of Banking & Finance (9h
Edition) by Charles J Woelfel
(We recommend this as work of authority and you can order
it here)
That
class of COMMERCIAL PAPER which is given in payment of merchandise and
discounted by the payee at his or her bank.
Trade acceptances may be classified as business paper.
When
such customer’s paper meets the standards for eligibility for rediscounting
at Federal Reserve banks by member banks of the Governors of the Federal
Reserve System, it is ELIGIBLE PAPER.
Commercial
paper technically consists also of promissory notes placed in the open
money market by business firms and finance companies, the former through
commercial paper dealers and the latter directly in recent years.
Money market rate quotations on such paper, usually on the basis
of four to six months’ maturity, prime, refer to such open market commercial
paper.
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