CAF-4 · Chapter 14 · Question 2 of 8
A promissory note is defined as an instrument in writing containing an unconditional ________ to pay a certain sum of money.
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) Undertaking
Explanation
A promissory note must contain an unconditional undertaking (promise) by the maker to pay a certain sum of money. A bill of exchange contains an 'order'.
More Negotiable instruments MCQs
- Q4Which of the following phrases makes a promissory note INVALID?
- Q5Evaluate the validity of this note: 'I promise to pay Adil or order Rs. 5,000 and 500 shares of Sigma Limited.'
- Q6In the context of a cheque, who is the 'drawee'?
- Q7Mujahid owes Rs. 500,000 to Shoaib and wants to issue a time instrument to settle the debt. Which document should Mujahid draft and sign?
- Q8Is the statement 'Nauman, I shall be highly obliged if you make it convenient to pay Rs. 100,000 to Mahreen' a valid bill of exchange?