What is a promissory note?

Question

Quizplus · Accepted Answer

A promissory note is a written promise to pay a specific amount of money at a specified time or on demand. It is signed by the borrower (issuer) and given to the lender (payee) as evidence of a debt. It essentially outlines the terms of a loan, including the amount borrowed, the interest rate, payment schedule, and any applicable fees. Option A and Option E refer to informal agreements and security agreements, respectively, that are not promissory notes. Option B refers to borrowing secured by accounts receivable, which is a type of loan but not necessarily a promissory note. Option D refers to a reserve requirement that banks must maintain with the central bank.

What Is a Promissory Note