Which of the Following Is True of Warranty Liability as It

question 58

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 the above.
• E)None of the above.

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Definitions:

Physical Things

Objects that exist in space and time, possessing material substance and can be perceived by the senses.

Directly Observed

A method of collecting data or information through immediate, firsthand observation.

Unchanging

Something that remains the same over time, not affected by external conditions or changes.

Chair

A piece of furniture designed to provide a person with a place to sit.