UPSC 2020: With reference to the Indian economy, consider the following statements : 1. ‘Commercial Paper’ is a short-term unsecured promissory note. 2. ‘Certificate of Deposit’ is a long-term instrument issued by the Reserve Bank of India to a corporation. 3. ‘Call Money’ is a short-term finance used for interbank transactions. 4. ‘Zero-Coupon Bonds’ are the interest bearing short-term bonds issued by the Scheduled Commercial Banks to corporations. Which of the statements given above is/are correct ?

Commercial Paper (CP) is an unsecured, short-term promissory note issued by companies, so statement 1 is right. Call money refers to very short-term (overnight/14-day) inter-bank loans, so statement 3 is also right. Certificates of Deposit are short-/medium-term negotiable receipts issued mainly by commercial banks, not long-term RBI papers, so statement 2 is wrong. Zero-coupon bonds pay no periodic interest and are usually issued by governments or designated institutions for longer tenors, not short-term interest-bearing instruments of scheduled commercial banks, so statement 4 is wrong. Hence only 1 and 3 are correct. ([edukemy.com](https://edukemy.com/blog/upsc-prelims-2020-question-70/?utm_source=openai))