Hayley signs an instrument payable to the order of InstaCredit,Inc.,that allows a holder to demand payment of the entire amount due,with inter?est,if Hayley fails to make a payment.This instrument is
A)negotiable.
B)nonnegotiable,because a holder can move up the payment date.
C)nonnegotiable,because moving up the payment date is conditional.
D)nonnegotiable,because the exact payment date cannot be deter?mined from the face of the instrument.

Question

Quizplus · Accepted Answer

The instrument described in the scenario allows a holder (i.e. someone who possesses and presents the instrument) to demand payment of the entire amount due with interest if Hayley fails to make a payment. This means that the instrument is negotiable according to the definition of negotiability, which requires that the instrument be payable to order or bearer and include an unconditional promise or order to pay. The fact that the instrument allows for acceleration (i.e. demanding payment of the full amount due before the original payment date) does not affect its negotiability, since acceleration is a common feature of many negotiable instruments.

Hayley Signs an Instrument Payable to the Order of InstaCredit,Inc