Bills of Exchange can be used in a way such as; by holding the bill till due date, by discounting the bill, and by endorsing the bill.Select one:TrueFalse
Question
Bills of Exchange can be used in a way such as; by holding the bill till due date, by discounting the bill, and by endorsing the bill.
Select one:
- True
- False
Solution
The statement is True.
Bills of Exchange can be utilized in multiple ways:
-
Holding the Bill Till Due Date: The holder can keep the bill until its maturity to receive the payment directly from the drawee.
-
Discounting the Bill: The holder can choose to present the bill to a bank or financial institution before the due date to receive a discounted amount, which is less than the face value of the bill.
-
Endorsing the Bill: The holder can transfer the bill to another party by endorsing it, thereby allowing the new holder to claim the payment upon maturity.
Thus, the uses described are valid for bills of exchange.
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