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Commercial paper is used by companies as a short-term financing tool to meet immediate cash flow needs, such as funding inventory purchases or covering operating expenses. It typically has maturities ranging from a few days to a year and is issued at a discount to its face value, allowing businesses to secure funds quickly and efficiently. By utilizing commercial paper, companies can avoid the higher costs associated with bank loans and maintain liquidity without long-term debt commitments.

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2w ago

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