Taft Has Entered into a Security Agreement with Caesar After

question 61

Multiple Choice

Taft has entered into a security agreement with Caesar after Caesar gave him a loan.The collateral in the agreement was Taft's car.The agreement outlined that Taft should use the car in accordance with the law and that it should be fully insured during the 3-year security agreement.Furthermore,if Taft does default,he has 10 days to remedy the default before he has to hand over the car.Which of the following is false?

• A)If Taft is charged with a DUI,he has probably defaulted.
• B)If Taft decides he doesn't need collision insurance,he has probably defaulted.
• C)If Taft defaults he must be given 15 days notice before the car is sold.
• D)If the car is worth more than the loan,Caesar must give the excess to Taft.
• E)If Taft's car breaks down,he has probably defaulted.

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Definitions:

Agricultural Futures

Futures contracts that are based on the future price of agricultural products such as wheat, corn, soybeans, and others, used by farmers and investors to hedge risks or speculate.

Actively Traded

Refers to securities or assets that are frequently bought and sold in financial markets, often indicated by high daily volume.

Futures Contract

A legal agreement to buy or sell a particular commodity or financial instrument at a predetermined price at a specified time in the future.

Long Position

The futures trader who commits to purchasing the underlying asset.