A bank discounts a note payable by deducting interest in advance.

Name: A bank discounts a note payable by deducting interest in advance.
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This statement is true. When a bank discounts a note payable, they deduct the interest in advance and provide the borrower with the remaining amount. This is because interest is charged upfront on the entire amount of the note, rather than over its entire term.

A Bank Discounts a Note Payable by Deducting Interest in Advance