Bill Submits a Time Card for a Non-Existent Employee

question 74

Multiple Choice

Bill submits a time card for a non-existent employee.The employer issues the payroll check.Bill forges the indorsement and negotiates the check to Ted.Which of the following statements is true?

• A)The loss from the forged check is borne by the holder in due course.
• B)The check cannot be negotiated as it carries the signature of a non-existent person.
• C)The employer has the right to refuse payment to Ted.
• D)Ted submits the check to the employer and receives the face amount.

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Definitions:

Network Externality

The increase in the value of a good or service to an individual is greater when a large number of others own or use the same good or service.

Positive Externality

A beneficial effect experienced by a third party due to an economic activity, without compensation.

Socially Optimal

Refers to a state or condition in which resources are allocated in the most efficient manner from the perspective of society as a whole, maximizing overall well-being.

Market Quantity

Refers to the total amount of a particular good or service that is available for purchase in a market at a specific point in time.