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?

1. A

   1 and 2 only

   1 and 2 only. CDs are short-term bank instruments, not long-term RBI paper to corporates.

2. B

   4 only

   4 only. Zero-coupon as ‘interest-bearing ST bank bonds to corporates’ is the usual false limb.

3. C

   1 and 3 only

   1 and 3 only. Commercial paper is a short unsecured promissory note; call money is interbank overnight money. CD and the ZCB wording fail.

4. D

   2, 3 and 4 only

   3 and 4 only. Drops CP; keeps a bad ZCB line.

Summary. Official key is (c) 1 and 3 only. CP: short-term unsecured corporate paper. Call money: overnight interbank. Certificates of Deposit are short-term bank deposits, not long RBI–to–corporate bonds. The zero-coupon statement as framed is not keyed.