Match Each Statement with the Correct Term Below

question 41

Multiple Choice

Match each statement with the correct term below.
-accommodation party

• A)An order to pay a fixed sum of money, signed by a drawer, payable on demand or at a definite time.
• B)A specialized form of draft; an order to pay money drawn on a bank and payable on demand.
• C)Legal concept that makes written instruments freely transferable and therefore a readily accepted substitute for money.
• D)Paper that is payable to the possessor of an instrument; a check that is made payable to cash or that is indorsed in blank.
• E)A person who is in possession of an instrument drawn, issued, or indorsed to him or to his order, or to bearer or in blank.
• F)A signature on an instrument that specifies no indorsee and may consist of merely the signature of the indorser or her authorized agent.
• G)Issuer of a promissory note or Cd.
• H)A written acknowledgement by a bank of the receipt of money that it promises to repay, with interest at a stated rate; a specialized form of promise to pay money that is given by a bank.
• I)A person or organization to whom a draft is directed, and who is ordered to pay the amount of money specified therein; the bank on which a check is drawn.
• J)Issuer of a check or draft.
• K)A signature on an instrument that attempts to limit the rights of the indorsee in some fashion.
• L)Signature that identifies an indorsee to be paid; makes the instrument order paper.
• M)Oral, written, or electronic instruction to a receiving bank to pay or to cause another bank to pay a fixed amount of money to a beneficiary.
• N)Contractual protections from liability good against holders but not against holders in due course.
• O)An instrument involving two parties, one of whom promises to pay to the order of the second a stated sum of money either on demand or at a stated future date.
• P)Person who signs an instrument to lend her credit to another party to the instrument.
• Q)The transferee of a holder in due course succeeds to the rights of a holder in due course even if the transferee does not qualify for holder in due course status.
• R)The first bank into which an item is deposited for collection.
• S)Demand for payment or acceptance of an instrument.
• T)Acceptance of a check by a bank.
• U)Protections from liability good against all holders, including holders in due course.
• V)Piece of paper, which may contain an indorsement, that is affixed to an instrument.

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Definitions:

Limited Liability

A legal structure for businesses that limits the personal financial responsibility of the owners for the company's debts and obligations.

Externalities

Financial repercussions impacting parties who are not directly involved, which may manifest as either beneficial or detrimental outcomes.

Sole Proprietorship

A business owned and operated by one person, where there is no legal distinction between the owner and the business entity.

High-Coupon Bonds

Bonds that offer interest rates significantly above the market average to attract investors despite potential risks.