Among the following cash and non-cash payment instruments, which one is referred as 'Legal Tender Money'?

Options :
  1. Cheques
  2. Drafts
  3. Bills of exchange
  4. Currency notes
Answer and Explanation :-

Answer: Option 4


Legal tender is a medium of payment allowed by law or recognized by a legal system to be valid for meeting a financial obligation. Paper currency and coins are common forms of legal tender in many countries. The origin of the term "legal tender" is from Middle English tendren, French tendre (verb form), meaning to offer. Legal tender is variously defined in different jurisdictions. Formally, it is anything which when offered in payment extinguishes the debt. Thus, personal cheques, credit cards, debit cards, and similar non-cash methods of payment are not usually legal tender. The law does not relieve the debt obligation until payment is tendered. Coins and banknotes are usually defined as legal tender.

How do you rate this queston?  Very Easy  Easy  Average  Above Average  Tough

Previous Question : Which of the following economic policy measures has 'Interest Rate Policy' as a component?

Next Question : The Government has assigned regulatory powers to which of the following institutions, to prevent rec...

Click here for online test on Economy


 (Getemail alerts when others member replies)

Your work is going to fill a large part of your life, and the only way to be truly satisfied is to do what you believe is great work. And the only way to do great work is to love what you do.If you haven't found it yet, keep looking. Don't settle.
-Steve Jobs