Money Market: The money market is a financial market that deals in short-term debt instruments, such as commercial paper, Treasury bills, and certificates of deposit. It provides a platform for the issuance and trading of these liquid, low-risk securities.
Unsecured Debt: Unsecured debt refers to loans or debt instruments that are not backed by any collateral. Commercial paper is an example of unsecured debt, as it is not secured by any physical assets or guarantees.
Liquidity: Liquidity refers to the ease with which an asset can be converted into cash. Commercial paper is considered a highly liquid instrument because it can be easily bought and sold in the money market.