In Circumstances Where a Bank Has Been Left with Liability

question 47

Multiple Choice

In circumstances where a bank has been left with liability for a forged cheque,why should every party accepting that cheque have verified the authenticity of the endorsements on it?

• A) The bank will deduct the value of the worthless cheque from any endorser's account.
• B) A verification agreement will entitle the bank to recover assets of endorsers.
• C) Without a special endorsement,collection may be a problem.
• D) All prior endorsers risk the bank's recovery efforts.

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Definitions:

Probability

The chance or risk of a particular event happening, represented as a fraction of total possible outcomes.

Plastic Arrow

Refers to an arrow made of plastic, often used for indoor archery practice or as a toy.

Probability Assignment

The process of assigning a likelihood to the occurrence of an event based on known parameters or outcomes.

Legitimate

Valid or acceptable according to the law or rules; genuine or right.