To Become a Negotiable Instrument, a Draft Must Conform to the Following

question 3

Multiple Choice

To become a negotiable instrument, a draft must conform to the following requirements EXCEPT:

• A) it must be in writing and signed by the maker or drawer.
• B) it must be payable to order or to bearer.
• C) it must be written in English.
• D) it must be payable on demand or at a fixed or determinable future date.

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Definitions:

Fixed Maturity Date

The predetermined date on which a financial instrument, such as a bond, loan, or investment, is due to be repaid or mature.

Ownership

The legal right to possess, use, and dispose of anything of value, including tangible and intangible assets.

Held-to-maturity Securities

Debt securities that a company has the intent and ability to hold until they mature, not to be sold beforehand.

Debt Investments

Investments made through the purchase of bonds, notes, or other financial instruments that obligate the issuer to pay the investor fixed or variable interest payments and to repay the principal at maturity.