Business Law, Text and Cases, Thirteenth Edition, Chapter 25 – Flashcards
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allows the payee or other holder of a time instrument to demand payment of the entire amount due, with interest, if a certain event occurs, such as a default in payment of an installment when due
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acceleration clause
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the drawee's written promise to pay the draft when it comes due
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acceptance
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a drawee who has accepted, or agreed to pay, an instrument when it is presented later for payment
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acceptor
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when a draft orders the buyer's bank to pay
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banker's acceptance
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a person in possession of an instrument that is payable to bearer or indorsed in bank
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bearer
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an instrument that does not designate a specific payee
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bearer instrument
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a type of note issued when a party deposits funds with a bank, and the bank promises to repay the funds, with interest, on a certain date
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certificate of deposit (CD)
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the most commonly used type of draft; the party the check is made payable to is the payee, the signer of the check is the drawer, and the bank that issued the check is the drawee.
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check
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an unconditional written order that involves three parties
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draft
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the party in a draft being ordered to pay money usually to a third party
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drawee
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the party creating the draft
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drawer
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allows the date of maturity to be extended into the future
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extension clause
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any person in possession of a negotiable instrument that is payable either to the bearer or to an identified person that is the person in possession
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holder
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the first delivery of an instrument by the maker or drawer for the purpose of giving rights on the instrument to any person
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issue
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the person who makes the promise in a promissory note
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maker
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a signed writing (or electronic record) that contains an unconditional promise or order to pay an exact amount, either on demand or at a specific future time
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negotiable instrument
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an instrument that is payable (1) to the order of an identified person or (2) to an identified person or order
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order instrument
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the party receiving payment in a draft
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payee
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when a demand to either pay or accept an instrument is made by or on behalf of a person entitled to enforce the instrument
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presentment
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a written promise made by one person to pay another a specified sum; sometimes referred to as just a "note"; can be made payable at a definite time or on demand
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promissory note
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nearly any symbol executed or adopted by a person with the intent to authenticate a written or electronic document. can be made by a device, rubber stamp, thumb print, etc
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signature
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the seller of the goods is both the drawer and the payee
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trade acceptance
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the seller of the goods is both the drawer and the payee
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trade acceptance
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the seller of the goods is both the drawer and the payee
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trade acceptance
