Question 1

Which of the following requirements must be met for a transferee of order paper to become a holder?

Accepted Answer

A)  Possession only 
B)  Indorsement and transfer only 
C)  Possession and indorsement of transferor 
D)  All of these. 
A)  Possession only 
B)  Indorsement and transfer only 
C)  Possession and indorsement of transferor 
D)  All of these.

Question 2

The most common method of discharging a negotiable instrument is by

Accepted Answer

A)  bankruptcy. 
B)  payment. 
C)  alteration. 
D)  cancellation. 
A)  bankruptcy. 
B)  payment. 
C)  alteration. 
D)  cancellation.

Question 3

Farnsworth has an instrument which was made "Payable to bearer." She loses the instrument, but it is found by Mellon. Mellon may

Accepted Answer

A)  collect payment on the instrument. 
B)  not collect payment because he gave no value for it. 
C)  not collect payment on the instrument because he only found it. 
D)  none of these. 
A)  collect payment on the instrument. 
B)  not collect payment because he gave no value for it. 
C)  not collect payment on the instrument because he only found it. 
D)  none of these.

Question 4

The Uniform Commercial Code (UCC) is very strict on what will constitute a signature that appears on a negotiable instrument.

Accepted Answer

A) True 
 B)False

Question 5

Receiving an instrument by negotiation

Accepted Answer

A)  is the same as receiving the instrument by assignment. 
B)  makes the third party who takes possession of the instrument a holder. 
C)  converts the instrument into bearer paper. 
D)  prevents the instrument from being further transferred. 
A)  is the same as receiving the instrument by assignment. 
B)  makes the third party who takes possession of the instrument a holder. 
C)  converts the instrument into bearer paper. 
D)  prevents the instrument from being further transferred.

Question 6

Riggins indorsed her paycheck with her signature and the words "without recourse." This is

Accepted Answer

A)  a special indorsement. 
B)  a blank indorsement. 
C)  a restrictive indorsement. 
D)  none of these. 
A)  a special indorsement. 
B)  a blank indorsement. 
C)  a restrictive indorsement. 
D)  none of these.

Question 7

A check is made payable to "Mark Spitz." If Spitz wishes to negotiate the instrument, he must

Accepted Answer

A)  indorse the instrument. 
B)  deliver the instrument. 
C)  indorse and deliver the instrument. 
D)  indorse or deliver the instrument at the discretion of Mark Spitz. 
A)  indorse the instrument. 
B)  deliver the instrument. 
C)  indorse and deliver the instrument. 
D)  indorse or deliver the instrument at the discretion of Mark Spitz.

Question 8

A payee of a negotiable instrument can transfer that instrument to another person by negotiation.

Accepted Answer

A) True 
 B)False

Question 9

A negotiable instrument may be negotiated by

Accepted Answer

A)  indorsement and delivery. 
B)  delivery alone. 
C)  either indorsement and delivery or delivery alone. 
D)  none of these. 
A)  indorsement and delivery. 
B)  delivery alone. 
C)  either indorsement and delivery or delivery alone. 
D)  none of these.

Question 10

Any significant alteration of a negotiable instrument discharges the liability of the party whose liability is changed by the alteration.

Accepted Answer

A) True 
 B)False

Exam 20: Issue, Transfer, Indorsement, and Discharge of Negotiable Instruments

Which of the following requirements must be met for a transferee of order paper to become a holder?

The most common method of discharging a negotiable instrument is by

Farnsworth has an instrument which was made "Payable to bearer." She loses the instrument, but it is found by Mellon. Mellon may

The Uniform Commercial Code (UCC) is very strict on what will constitute a signature that appears on a negotiable instrument.

Receiving an instrument by negotiation

Riggins indorsed her paycheck with her signature and the words "without recourse." This is

A check is made payable to "Mark Spitz." If Spitz wishes to negotiate the instrument, he must

A payee of a negotiable instrument can transfer that instrument to another person by negotiation.

A negotiable instrument may be negotiated by

Any significant alteration of a negotiable instrument discharges the liability of the party whose liability is changed by the alteration.

Foundations of Law and the Role of Ethics in Business

The Legal System in the United States and Its Constitutional Foundation

Personal, Business, and Cyber Crimes and the American Criminal Justice System

Tort Law: Traditional Torts and Cyber Torts

Litigation and Alternatives for Settling Civil Disputes

Contract Law: a Beginning

Agreement: Offer and Acceptance

Consideration

Capacity

Legality

Memorialize Contracts in Writingstatute of Frauds

Transfer of Contract Rights and Duties

The Termination of Contracts: Discharge

The Termination of Contracts: Breach of Contract

Formation of Sales and Lease Contracts

The Sales Contract: Transfer of Title and Risk of Loss

The Sales Contract: Performance, Breach, and Remedies for Breach

Product Liability Law

Nature and Types of Negotiable Instruments

Rights and Duties of Parties

Checks and the Banking System in the Twenty-First Century

Employer-Employee Relationship

Principal-Agent Relationship

Principal-Agent, Employer-Employee, and Third-Party Relationships

Sole Proprietorships, Partnerships, and Limited Liability Organizations

Corporations and Franchising

Government Regulation of Business

Basic Legal Concepts of Property

Renting Real Property

Buying and Selling Real Property

Nature and Types of Bailments

Wills, Intestacy, and Estate Planning

Protecting the Consumer and the Taxpayer

Protecting the Borrower

Protecting the Creditor

Property, Casualty and Automobile Insurance

Personal Insurance

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