A negotiable instrument may be transferred to a new beneficiary by __________________, that is to say

by writing and signing an instruction on the back of the document.(?)

enhancement
endorsement(+)
enforcement
Some negotiable instruments are made out to the __________________ of the document rather than to
a specific, named person.(?)
claimant
signatory
holder(+)
A __________________ is a written promise by the maker to pay money to the payee, the most common
form of which is the bank note.(?)
promissory note(+)
lease agreement
novation clause
Good instruments should include a well-drafted __________________ clause, outlining the
circumstances under which the money borrowed must be repaid earlier than the agreed date.(?)
severability
termination
acceleration(+)
In the US, negotiable instruments are also known as __________________.(?)
commerce papers
commercial papers(+)
financial papers
The charging of unlawfully high interest rates is known as __________________, a practice that is a
criminal offence in most jurisdictions.(?)
usury(+)
profiteering
exploitation
The __________________ takes good title to the negotiable instrument, even if the person who
transferred the instrument to him or her does not hold title.(?)
maker
endorsee
holder in due course(+)

For value received, the __________________ promises to pay on demand to the order of IKB gmbh the
principal sum of $25 000.(?)
underwritten
underscored
undersigned(+)
Interest shall __________________ on the outstanding principal balance of this note commencing on the
date hereof.(?)
amalgamate
accrue(+)
disperse
The __________________ of this note may be accelerated by Payee in the event Maker is in breach or
default of any of the terms or conditions of the Agreement.(?)
endorsement
validity
maturity(+)

An instrument payable "when the next full moon appears in London, England" is _____.
payable at a definite time
A)
not payable a t a definite time
B)
not enforceable
C)
void
D)

2
INCORRECT

An instrument payable "to left-handed citizens of Dover, Delaware who are over
age sixty" _____.
is payable to order
A)

is not payable to order

B)
is payable to order and bearer
C)
is payable to order, bearer, and the city of Dover, Delaware
D)

3
INCORRECT

"IOU $1,000" is _____.

not a promise to pay
A)
not an order to pay
B)
neither a promise nor an order to pay
C)
negotiable since it acknowledges its debt
D)

4 CORRECT
An instrument that states that it is "subject to a home improvement contract
between Jones and Vangard Co." is _____.
conditional
A)
unconditional
B)
conditional unless the amount is less that $1,500
C)
unconditional unless and copy of the contract is attached
D)

5
INCORRECT

In order to be negotiable an instrument cannot be written _____.

in pencil

A)
with a marker
B)
with a red pen
C)
on ice
D)

6
INCORRECT

A holder is a person who is in possession of a negotiable instrument that is

_____.
issued or indorsed to that person's order
A)
issued or indorsed to bearer
B)
issued or indorsed to that person's order or issued or indorsed to bearer
C)
written so that a bank is the drawee
D)

7
INCORRECT

If an instrument is conditional it is _____.

negotiable
A)
a simple contract
B)
void
C)
unenforceable
D)

8
INCORRECT

An instrument that is "payable on June 6, 2066" is _____.

too distant in time to be negotiable

A)
lacking in definiteness
B)
unenforceable
C)
payable at a definite time
D)

9
INCORRECT

Article 3 of the UCC was revised in _____.

1980
A)
1985
B)
1990
C)
1995
D)

10
CORRECT

A CD is repaid by _____.
a bank
A)
the customer of a bank
B)
the bearer
C)
government
D)