CUET Preparation Today
| As call money rates rise, the other forms of financing, such as commercial paper and certificate of deposit, become: |
More expensive
Less expensive
Other sources are unaffected by this
None of the above |
| Less expensive |
| There is an inverse relationship between call rates and other short-term money market instruments such as certificates of deposit and commercial paper. A rise in call money rates makes other sources of finance such as commercial paper and certificates of deposit cheaper in comparison for banks raise funds from these sources |
