From the following, identify combination of instruments which are used to raise long term funds with period of maturity over one year.

(A) Treasury bill

(B) Certificate of deposit

(C) Shares

(D) Debentures having maturity of 5 years

(E) Commercial Paper

Choose the correct answer from the options given below :

(C) and (D) Only

The correct answer is option 4- (C) and (D) Only.

(C) Shares: Shares represent ownership in a company and are a form of equity financing, often used to raise long-term funds for business operations and expansion.

(D) Debentures having maturity of 5 years: Debentures are long-term debt instruments issued by companies to borrow money at a fixed rate of interest over a specified period, typically more than one year.

Money Market is a market for short-term funds. It deals in monetary assets whose period of maturity is less than one year. The instruments of money market includes treasury bills, commercial paper, call money, Certificate of deposit, commercial bills, participation certificates and money market mutual funds.

(A) Treasury bill: Treasury bills are short-term debt instruments issued by the government to raise funds for a period of less than one year.

(B) Certificate of deposit: Certificates of deposit (CD) are unsecured, negotiable, short-term instruments in bearer form, issued by commercial banks and development financial institutions. They can be issued to individuals, corporations and companies during periods of tight liquidity when the deposit growth of banks is slow but the demand for credit is high. They help to mobilise a large amount of money for short periods.

(E) Commercial Paper: Commercial paper is a short-term unsecured promissory note, negotiable and transferable by endorsement and delivery with a fixed maturity period. It is issued by large and creditworthy companies to raise short-term funds at lower rates of interest than market rates.