A note which contains the statement, "I owe you $500":
A) constitutes an order to pay.
B) constitutes a promise to pay.
C) is not a negotiable instrument.
D) does not acknowledge a debt.

Question

Quizplus · Accepted Answer

If an instrument is promissory in nature, such as a note or a certificate of deposit, it must contain an unconditional promise to pay or it cannot be negotiable. Merely acknowledging a debt is not sufficient. For example, the statement "I owe you $100" does not constitute a promise to pay. An IOU in this form is not a negotiable instrument.

A Note Which Contains the Statement, "I Owe You $500