Which of the Following Is True of Warranty Liability as It

question 26

Multiple Choice

Which of the following is true of warranty liability as it affects negotiable instruments?

• A) Warranty liability applies to any persons who transfer an instrument and receive consideration.
• B) A drawee of an unaccepted draft who pays in good faith receives a presentment warranty from the person obtaining payment and from all prior transferors of the draft.
• C) A drawee who accepts an instrument in good faith receives a presentment warranty from the person obtaining acceptance that the draft has not been altered.
• D) All of these statement are true of warranty liability.

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Definitions:

Seasonal Variation

Fluctuations in data or activity that occur at regular intervals due to seasonal factors.

Forecasting

The process of making predictions about the future based on past and present data and analysis of trends.

Exponential Smoothing

A forecasting technique that applies diminishing weights to past observations, with recent observations given more weight than older observations.

Weights

Factors that adjust the importance or influence of different items in a calculation, often used in statistical analysis and algorithms.