Bills of Exchange Practice Test Questions — Flashcards

A bill of exchange is a written order used primarily in international trade that binds one party to pay a fixed sum of money to another party on demand or at a predetermined date.

Common types of Bill of Exchange are:
Demand Bill: This bill is payable when it demanded. The bill does not have a fixed date of payment, therefore, the bill has to be cleared whenever presented.
Usance Bill: It is a time-bound bill which means the payment has to be made within the given time period and time.