Which of the Following Is an Example of a Check-Kiting

question 62

Multiple Choice

Which of the following is an example of a check-kiting scheme? ​

• A)A person has two accounts and deposits a large check from one to the other.
• B)A person has two accounts and deposits a large check from one to the other, then fraudulently withdraws money from the account before the check clears.
• C)A person has two accounts and deposits a large check from one to the other knowing the check will bounce.
• D)A person has two accounts and deposits a forged check in one of the accounts.

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Definitions:

Cash Dividends

Payments made by a corporation to its shareholders, usually as a distribution of profits.

Underlying Stock

The stock that is the basis for a particular derivatives contract, such as options or futures.

Convertible Bond

A type of bond that can be converted into a predefined number of the issuing company's shares, typically at the discretion of the bondholder.

Call Option

An option that allows the holder to buy the asset at some predetermined price within a specified period of time.