Which of the Following Is the Result If a Payee

question 72

Multiple Choice

Which of the following is the result if a payee who receives an instrument with missing information completes the missing information in a way that is inconsistent with the intent of issuer, and the instrument has been clearly materially altered?

• A) The person taking the instrument cannot become a holder in due course.
• B) The alteration does not prevent a person taking the flawed instrument from becoming a holder in due course.
• C) There is no effect so long as the payee can establish that he or she did not receive any more consideration than that to which the payee was entitled.
• D) The instrument is considered materially altered, but it only prevents transfer to a holder in due course if the holder in due course had knowledge that the payee had done the alteration.
• E) The instrument is considered materially altered, but it only prevents transfer to a holder in due course if the transferee participated in the material alteration.

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Definitions:

Economic Profits

The difference between a firm's total revenue and its total costs, including both explicit and implicit costs.

Accountants

Professionals responsible for managing and auditing financial records, ensuring accuracy and compliance with legal requirements.

Short Run

Describes a period in which some factors of production or inputs are fixed, limiting the ability of a business to fully adjust to market changes.

Long Run

A period in which all factors of production and costs are variable, and firms can adjust all inputs.