Which of the Following Is True Regarding an IOU Instrument

question 13

Multiple Choice

Which of the following is true regarding an IOU instrument containing the language "payable on demand"?

• A)The instrument is not negotiable because it does not contain an unconditional promise or order to pay,but it may be an enforceable contract.
• B)The instrument is not negotiable because the words "payable on demand" are included;otherwise,the IOU instrument would contain an unconditional promise to pay.
• C)The instrument contains an unconditional promise to pay but nevertheless is not negotiable because it is an IOU instrument.
• D)The instrument contains an unconditional promise to pay;and,therefore,the fact that it is an IOU instrument does not affect negotiability.
• E)The instrument is not negotiable,nor could it be an enforceable contract,because it does not contain an unconditional promise to pay.

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Definitions:

Legal Regulations

Legal regulations are the rules and laws that are established by governing bodies to control or govern conduct, usually mandatory in nature and applied across various sectors and activities.

Effective Compensation

A compensation strategy that is competitive, fair, and aligns with the company's goals, effectively motivating and rewarding employees.

Job Evaluation

A systematic process used by organizations to assess the relative value of jobs within the company to determine fair compensation.

External Equity

Perceived fairness in pay relative to what other employers are paying for the same type of work.