Q.Which source of finance is described as a 'short-term, unsecured promissory note' issued in the money market by large, creditworthy companies?
(A) Debenture
(B) Commercial paper
(C) Public deposit
(D) Trade credit

This question tests recognition of a specific modern money-market instrument by its textbook definition.

We check each option against the specific description given: 'short-term, unsecured promissory note issued in the money market by large, creditworthy companies.'

(A) A debenture is typically a longer-term instrument and can be secured or unsecured, but it is a certificate of loan (a bond), not specifically a short-term money-market promissory note, so it does not match this description.

(B) Commercial paper is precisely defined as a short-term, unsecured promissory note issued in the money market, available only to large firms with a strong credit rating because there is no collateral backing it — this matches the description exactly. …

Students often mix up commercial paper with a public deposit because both are short/medium-term and both involve raising money from outside investors — the distinguishing features are that commercial paper is unsecured, tradeable, and restricted to only very large, …