Exam 22: Introduction to Commercial Paper

If a drawer of a check has the bank certify it,he or she remains _________for payment of the check until the holder can reasonably present it for payment.

Commercial paper that is dated ahead is:

A person may not postdate a check for self-protection when some act is to be completed by the payee before the date of the check.

An Automated Teller Machine performs many of the functions of a bank as per the instructions of a(n):

The two basic types of commercial paper are promises to pay through notes and orders to pay through checks and drafts.

A __________ is a certified check issued in a denomination of $10 or more by certain banks,travel agencies,and financial services companies.

An item of commercial paper containing the key words of negotiability,such as "pay to the order of," or their equivalent,is a(n):

The purpose of the Electronic Funds Transfer Act of 1979 is to govern transfers among financial institutions or among businesses.

A cashier's check is drawn against the depositor's own funds.

An instruction a depositor gives to his or her bank not to pay a particular check is known as a(n):

A written order drawn on a bank by a depositor that requests the bank to pay,on demand and unconditionally,a definite sum of money to the bearer of the instrument or to the order of a specified person is called a:

Checks are sometimes payable on demand.

State the differences between commercial paper and an ordinary contract.

Commercial paper may be handwritten,printed,or written by any other means that will make a mark.

An instrument should contain any of the following words of negotiability in order to make an instrument negotiable EXCEPT the word:

Commercial paper differs from ordinary contracts because of:

Commercially acceptable documents,such as notes,checks,and drafts,are used to transfer money from one person to another.

A system which allows a consumer to transfer funds from a bank account to the merchant's bank account to pay for merchandise purchased is known as a:

Forged checks are illegal,whereas raised checks are not.

An instrument payable in a foreign currency is negotiable.