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ECO MCQs Test Bank 1




Question;1.A negotiable instrument is any written promise or order to pay a sum of money.A) TrueB) False2.A signature can consist of initials signed by a party.A) TrueB) False3.To obtain office supplies for All-Care Medical Clinic, Britney executes a draft in favor of Chris. A draft isA) a conditional promise to pay money.B) an unconditional written order to pay money.C) a qualified promise to set aside a sum of money.D) a restricted promise to deliver goods at a future date.4.Doug writes a check for $100 payable to Eve on his account at First State Bank. The bank isA) the bearer.B) the drawee.C) the drawer.D) the holder.5.To borrow money to finance the start-up of his business, Bob executes an instrument in favor of City Bank. For the instru?ment to be negotiable, the signature must beA) anywhere on the instrument.B) anywhere on the lower half of the instrument only.C) in the lower left-hand corner of the instrument only.D) in the lower right-hand corner of the instrument only.6.Karen writes on a piece of paper, ?I owe you $600,? signs it, and gives it to Lou. This instrument isA) negotiable.B) nonnegotiable, because it does not include an express promise to pay.C) nonnegotiable, because it does not recite any consideration.D) nonnegotiable, because it does not state any conditions to payment.7.A holder takes an instrument for value if he or she gives a check as pay?ment for it.A) TrueB) False8.An instrument is not defective simply because it is overdue.A) TrueB) False9.Presentment war?ranties protect the person who presents an instrument for payment.A) TrueB) False10.Accidental destruction of a negotiable instrument cancels it.A) TrueB) False11.Don writes a check to Eve drawn on Don?s account at First Town Bank. Eve presents the check for payment to the bank, which accepts the check. The bank isA) not liable for payment.B) primarily liable for payment.C) secondarily liable for payment.D) simultaneously liable for payment.12.Opal asks Paolo, who does not understand English, to sign what Opal says is an application to open a bank account. In fact, the ?application? is a note. If sued on the note by an HDC, Paolo?s best defense would beA) extreme duress.B) fraud in the execution.C) fraud in the inducement.D) mistake.13.Rich signs a promissory note after a court has adjudged him to be men?tally in-competent. The note isA) assignable only.B) negotiable.C) void.D) voidable only.14.The Uniform Commercial Code governs checks.A) TrueB) False15.The rights and duties of a bank and its customer are contractual.A) TrueB) False16.The death of a customer revokes a bank?s authority to pay an item.A) TrueB) False17.Most forms of e-money do not qualify as deposits and thus are not covered by deposit insurance.A) TrueB) False18.Jen signs a check ?pay to the order of Key? drawn on Jen?s account in Little Bank to buy Key?s car. If there are insufficient funds in Jen?s account to cover the amount of the check, but the bank pays it, this createsA) a cashier?s check.B) an overdraft.C) a stale check.D) a stop-payment order.19.Duffy writes a check for $100 drawn on Eastside Bank and presents it to Fast Cash, Inc., for payment. If the check is not backed by sufficient funds, Duffy may be prosecuted forA) forgery.B) fraud.C) negligence.D) robbery.20.E-Bank, an online financial institution, gives financial information about Paula and other customers to a federal agency without the customers? permission. E-Bank may be liable underA) the Federal Trade Commission Act.B) the Financial Services Modernization Act.C) the Right to Financial Privacy Act.D) the Uniform Electronic Transactions Act.


Paper#56784 | Written in 18-Jul-2015

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