Alvin signs a promissory note payable to the order of Borrow & Spend Loan Company. The note states that it is payable "with interest at the legal rate." This note is
A)not necessarily nonnegotiable.
B)not negotiable, because it does not specify a rate of interest.
C)not negotiable, because it is a promissory note.
D)not negotiable, because it is payable only with interest.

Question

Quizplus · Accepted Answer

A promissory note can still be negotiable even if it states interest at the legal rate, as long as it meets other requirements of negotiability. The note does not need to specify the exact rate if it refers to a legal rate.

Alvin Signs a Promissory Note Payable to the Order of Borrow