Commercial Applications
…………… is not a legal tender and the creditor may refuse to accept it.
- Bank Draft
- Cheque
- Overdraft
- Cash
Banking
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Answer
Cheque
Reason — As stated in the chapter under disadvantages of payment by cheques: "Cheques are not legal tender and a creditor may refuse to accept a cheque in payment." Currency issued by the monetary authority is legal tender and must be accepted in settlement of a debt. A creditor has the right to refuse payment by cheque.
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