Exam 19: Nature and Types of Negotiable Instruments

A promissory note and a certificate of deposit has three parties, the maker, the makee, and the payee.

A draft involves two parties, the drawer and the payee.

Which of the following statements is true?

Parris signed a promissory note agreeing to pay $1,000 to Golden thirty days after graduating from college. Is this note negotiable?

A(n) ____________________ is a written promise by one party to pay a certain sum of money to another party.

Samuels gave Albrite's Lumber Company a ninety-day promissory note for $2,000 for goods purchased. Albrite's Lumber Company is legally known as the

The party who issues a promissory note is called the payee.

Under the UCC, if there is a discrepancy between the amount written in words and the amount indicated in figures on an instrument, the amount written in ____________________ would be paid.

The person who issues a check to another is called the

What are the two major uses of a negotiable instrument and what types of negotiable instruments serve each purpose?

A(n) ____________________ is a promise by a bank to repay money left on deposit by a depositor.

Barnes made out a check payable to the order of Williams. The amount written in figures was "$10.00"; the amount written in words was "One hundred and 00/100 dollars." Is this check negotiable? If so, what amount will be paid?

A note or a check payable in a foreign currency that is the legal currency of that foreign country is fully negotiable.

An instrument is not negotiable if it is

A written order by one person directing the person's bank to pay a certain sum of money to another person is a

An instrument is payable or at a definite time if it is payable

Article 3 of the UCC is the statutory law that governs negotiable instruments.

A promise to pay $1,000 and a golf bag would not be negotiable.

If an instrument is negotiable, it

For an instrument to be negotiable, the promise or order must be ____________________.