Edna Is the Payee of a Bearer Instrument-A Promissory Note

question 2

Multiple Choice

Edna is the payee of a bearer instrument-a promissory note in the amount of $10,000. Flem offers to irrigate Edna's ranch next week in exchange for the note. She agrees and delivers the note to Flem. Flem is

• A)an HDC, because he promised to perform services at a future date.
• B)an HDC, because the transferor was the original payee on the note.
• C)not an HDC, because he did not acquire the instrument in good faith.
• D)not an HDC, because he did not yet give value for the instrument.

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Definitions:

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A term used in finance to describe the profits or losses from a security or portfolio that differ significantly from expected or average returns.

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