Question 1

An instrument is payable to ____________________ if it is to be paid to whomever has possession of it.

Accepted Answer

The answer of An instrument is payable to ____________________ if...

Question 2

An "X" or a thumb print qualifies as a signature on a negotiable instrument.

Accepted Answer

A) True 
 B)False

Question 3

It is not a requirement of a negotiable instrument that it

Accepted Answer

A)   be payable in money.
B)   be payable at a specified or determinable time.
C)   be payable at a definite time.
D)   contain an unconditional promise to pay.E) A) and D)
F) B) and D)

Question 4

One way to classify a negotiable instrument is either a demand instrument or a time instrument.

Accepted Answer

A) True 
 B)False

Question 5

The signature on a negotiable instrument must

Accepted Answer

A)   be handwritten.
B)   be typed.
C)   be that of the maker or drawer.
D)   appear in the lower right-hand corner of the instrument.E) B) and C)
F) A) and D)

Question 6

An IOU for $500 is

Accepted Answer

A)   illegal.
B)   a legal substitute for a check.
C)   negotiable if properly signed.
D)   nonnegotiable.E) C) and D)
F) A) and B)

Question 7

In regard to a promissory note, the person obligated to pay is the

Accepted Answer

A)   payor.
B)   promissor.
C)   bank.
D)   maker.E) A) and B)
F) A) and C)

Question 8

A promissory note states that the note is due one year from March 31, 2010 "with interest at the current rate." Is this instrument negotiable?

Accepted Answer

Yes. Payable "with interest at...

Question 9

The words order and bearer are words of negotiability.

Accepted Answer

A) True 
 B)False

Question 10

A(n) ____________________ refers to a written document that can be used as a substitute for money.

Accepted Answer

negotiable...

Question 11

The words "value received" inserted on the face of a promissory note mean that ____________________ was given for the instrument.

Accepted Answer

The answer of The words "value received" inserted on the...

Question 12

An instrument "payable to order" is payable to a specific person or to anyone that person designates.

Accepted Answer

A) True 
 B)False

Question 13

There is no such thing as an oral note or check.

Accepted Answer

A) True 
 B)False

Question 14

Negotiable instruments can be used either as a substitute for money or as a means of extending credit.

Accepted Answer

A) True 
 B)False

Question 15

An instrument stating on its face, "Pay to Robert Stevens or bearer" is

Accepted Answer

A)   nonnegotiable.
B)   negotiable.
C)   an order instrument.
D)   a draft.E) A) and D)
F) A) and B)

Question 16

The drawee of a check is always the

Accepted Answer

A)   person who will receive the money.
B)   holder of the check.
C)   bank.
D)   depositor.E) None of the above
F) All of the above

Question 17

A check made payable to "Cash" is

Accepted Answer

A)   payable to the bearer.
B)   nonnegotiable.
C)   void.
D)   an order instrument.E) A) and D)
F) B) and C)

Question 18

A negotiable instrument is

Accepted Answer

A)   required to be in writing.
B)   a means of extending credit.
C)   a substitute for money.
D)   all of these.E) A) and C)
F) A) and B)

Question 19

A certificate of deposit is actually a loan by a depositor to a bank.

Accepted Answer

A) True 
 B)False

Question 20

A check dated later than the date it was originally made out is called a(n) ____________________ check.

Accepted Answer

The answer of A check dated later than the date...

Exam 19: Nature and Types of Negotiable Instruments

In regard to a promissory note, the person obligated to pay is the

Correct AnswerverifiedShow Answer

An instrument stating on its face, "Pay to Robert Stevens or bearer" is

Correct AnswerverifiedShow Answer

The signature on a negotiable instrument must

Correct AnswerverifiedShow Answer

An instrument is payable to ____________________ if it is to be paid to whomever has possession of it.

Correct AnswerverifiedShow Answer

A promissory note states that the note is due one year from March 31, 2010 "with interest at the current rate." Is this instrument negotiable?

Correct AnswerverifiedYes. Payable "with interest at...View AnswerShow Answer

An "X" or a thumb print qualifies as a signature on a negotiable instrument.

Correct AnswerverifiedShow Answer

A negotiable instrument is

Correct AnswerverifiedShow Answer

The words "value received" inserted on the face of a promissory note mean that ____________________ was given for the instrument.

Correct AnswerverifiedShow Answer

An IOU for $500 is

Correct AnswerverifiedShow Answer

A certificate of deposit is actually a loan by a depositor to a bank.

Correct AnswerverifiedShow Answer

A check dated later than the date it was originally made out is called a(n) ____________________ check.

Correct AnswerverifiedShow Answer

The drawee of a check is always the

Correct AnswerverifiedShow Answer

An instrument "payable to order" is payable to a specific person or to anyone that person designates.

Correct AnswerverifiedShow Answer

There is no such thing as an oral note or check.

Correct AnswerverifiedShow Answer

It is not a requirement of a negotiable instrument that it

Correct AnswerverifiedShow Answer

One way to classify a negotiable instrument is either a demand instrument or a time instrument.

Correct AnswerverifiedShow Answer

The words order and bearer are words of negotiability.

Correct AnswerverifiedShow Answer

Negotiable instruments can be used either as a substitute for money or as a means of extending credit.

Correct AnswerverifiedShow Answer

A check made payable to "Cash" is

Correct AnswerverifiedShow Answer

A(n) ____________________ refers to a written document that can be used as a substitute for money.

Correct Answerverifiednegotiable...View AnswerShow Answer

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Yes. Payable "with interest at...
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negotiable...
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