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WAEC Commerce 2019 Question 28

Question 28

Banking

A cheque for which payment is refused due to insufficient funds is a

  1. A.bearer cheque.
  2. B.crossed cheque.
  3. C.dishonoured cheque.
  4. D.stale cheque.
Show the answer and explanation

Answer: C (dishonoured cheque.)

Explanation

When a bank refuses to pay a cheque, e.g. for lack of funds, the cheque is dishonoured.