EXAM__3_-_SPRING_2004

EXAM__3_-_SPRING_2004 - 1 PART #1 TRUE OR FALSE QUESTIONS...

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TRUE OR FALSE QUESTIONS True: A , False : B , Maybe: Maybe A or Maybe B 1. A A person who signs and delivers an incomplete check to another person may not recover from his or her bank if the other person filled out a greater amount than he or she was supposed to and the bank paid it in good faith (did not know what the instructions were). 2. B Finance companies which purchase consumer notes from dealers occupy the status of “Holder In Due Course” meaning that if the goods purchased are defective, the finance companies may still enforce the obligation of the consumers to pay. 3. A If a customer discovers the loss of his or her ATM card and notifies (Tho^ng Ba/o) the bank within two days, his or her maximum liability for unauthorized withdrawals is $50 under the Electronic Transfer of Funds Act. 4. A The “Warranty of Fitness for a Particular Purpose” arises when a buyer relies on a seller to select a product to perform a certain thing and the seller knows of the buyer’s reliance. 5. A If a bank pays a check despite having a valid stop payment order from its customer, to recover the amount of the check, the customer must prove both the fact and amount of his or her loss. 6. A A handwritten signature is not required to authenticate a negotiable instrument. 7. A In a single delivery sale of goods, if the goods fail to conform (Tua^n theo la^~n lua^.t le^. tie^u chua^?n) in every respect and there is no time to “cure” the buyer may reject (khu’o’/c tu’`) them and may not be liable for their price. 8. A The “Holder in Due Course” rule of the Federal Trade Commission applies only to obligations financing the purchase of consumer goods and services. 9. A The law, whose requiring (A^/n =di.nh) banks to make certain funds on checks deposited with it available to a customer within 2 or 5 business days, does not apply to all deposits. 10. B Merchant sellers can limit all consequential damages for breach of warranty on items sold. 11. B A bank must stop honoring (paying) a deceased customer’s checks immediately upon receipt of notice of the customer’s death. 12. B Drawers and endorsers are primarily liable on negotiable instruments. THE GRADING EXAM #3 – SPRING 2004
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EXAM__3_-_SPRING_2004 - 1 PART #1 TRUE OR FALSE QUESTIONS...

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