Asked by Belinda Riojas on May 17, 2024
Verified
Which of the following is true regarding the relationship between negotiability and an unconditional promise or order to pay?
A) There is no such requirement in order to find negotiability.
B) A promise or order to pay must be specific and not be implied in order for negotiability to be found.
C) Simply acknowledging a debt satisfies the negotiability requirement of an unconditional promise to pay.
D) A common IOU is sufficient to satisfy the negotiability requirement of an unconditional promise to pay.
E) An offer of unconditional partial payment satisfies requirements of negotiability.
Negotiability
The quality of a financial instrument that allows it to be transferred or assigned from one party to another with ease.
Unconditional Promise
A commitment to act or refrain from acting in a certain manner that does not rely on any conditions or occurrences for its fulfillment.
IOU
An informal document that acknowledges a debt owed by one party to another, but not necessarily specifying repayment terms.
- Determine the qualifications for an instrument to be deemed negotiable.
Verified Answer
Learning Objectives
- Determine the qualifications for an instrument to be deemed negotiable.
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