Which of the Following Statements Is True of Novation

question 77

Multiple Choice

Which of the following statements is true of novation?

• A) Novation is a type of discharge of contract in which the original agreement is substituted with a new one.
• B) Novation leads to a change in the contractual duties of the new party.
• C) Novation can be carried out only if all the original parties agree to the substitution of new parties.
• D) Novation refers to a particular future event that terminates the contract if it does not follow the execution of the contract.

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Definitions:

Lockbox System

A service offered by banks to companies for receiving payments from customers; the bank collects and processes these payments directly to speed up the deposit process.

Firm Implementation

The process of putting a business strategy or plan into action to achieve its goals and objectives.

Float

The time difference between when a check is written and when the funds are actually withdrawn from the account, or the number of shares available for trading of a particular stock.

Smart Card

A smart card is a plastic card embedded with a microprocessor chip, which can store and process data, used for various purposes such as financial transactions, identification, and access control.