Read the Following Statements with Regard to the Parties Involved

question 5

Multiple Choice

Read the following statements with regard to the parties involved with negotiable instruments and indicate which is false.

• A) The person who signs and issues the cheque is the drawer. The person who is owed the money and receives the cheque is the drawee.
• B) The person who signs a draft is the drawer; the party commanded to pay is the drawee.
• C) An acceptor of a draft will become liable to the payee for the amount of the draft.
• D) The payee of a negotiable instrument can negotiate the instrument to a holder, who will be remote in relation to the drawer.
• E) The person who signs a promissory note is the maker of the note, and unlike a cheque, the note will not include a drawee.