XYZ Company has a well established commercial paper (CP) program that they use to fund...

Vendor: AFP
Product: CTP
Update on: Oct 21, 2025
Questions: 1076

AFP CTP Question Answer

XYZ Company has a well established commercial paper (CP) program that they use to fund operations. The company is expanding by purchasing a new factory. The CFO is worried about the time and expense needed to issue long-term debt and decides to use the funds they raise in the CP market to pay for the purchase of the factory. This strategy will be successful if:

an interest rate swap is used.

a credit default swap is employed.

a commodities future is purchased.

the yield curve remains upward sloping.