Dhani Signs a Check "Pay to the Order of Eton

question 43

Multiple Choice

Dhani signs a check "pay to the order of Eton" drawn on Dhani's account in Fidelity Guaranty Bank and dates the check "May 1." Eton presents the check to the bank for payment the following December 15. This is

• A)an oversight.
• B)an overdraft.
• C)a certified check.
• D)a stale check.

---

Definitions:

Systematic Risk

The risk inherent to the entire market or an entire market segment, which cannot be mitigated through diversification.

Asset Specific Risk

The risk of loss associated with a particular asset, different from market risk.

Portfolio Diversification

A risk management technique that mixes a wide variety of investments within a portfolio.

S&P/TSX 60 Index

A stock market index of 60 large companies listed on the Toronto Stock Exchange, representing leading sectors in Canada.