A Drawer's Written Stop-Payment Order Is Valid for Six Months

question 40

Multiple Choice

A drawer's written stop-payment order is valid for six months and the drawer can extent it for an additional ________ by giving the bank instructions in writing to continue the order.

• A)six months
• B)30 days
• C)90 days
• D)month

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Definitions:

Mandatory

Something that is required or obligatory by law or rules.

Chilling Effect

A chilling effect occurs when the exercise of rights or freedoms is discouraged by the threat of legal sanction or other negative consequences, leading to self-censorship or avoidance of certain actions.

Arbitration

A method of dispute resolution where an impartial third party, the arbitrator, makes a binding decision to resolve a dispute outside of court.

Contract Disputes

Conflicts that arise over the interpretation, fulfillment, or breach of a contract between two or more parties.