Which of the Following Situations Best Indicates That a Person

question 10

Multiple Choice

Which of the following situations best indicates that a person would not qualify as a holder in due course?

• A) Arranges to pay for the instrument at a later time.
• B) The person was notified that a prior indorser was discharged but in good faith.
• C) The person took the instrument in payment of a prior debt.
• D) The person accepted the instrument from a thief unaware of this fact.

---

Definitions:

Chrysler 300

A full-size luxury sedan manufactured by Chrysler, known for its powerful engines and elegant design.

Rescission

A remedy in contract law that annuls the agreement, returning both parties to their respective positions prior to the contract being made.

Liquidated Damages

A contractual provision that specifies a predetermined amount of money that must be paid as damages for failure to perform certain aspects of a contract.

Mitigate

To lessen a loss, for example, by victims of a breach, who have a duty to take all reasonable steps to minimize losses suffered.