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      Question

      The term 'Days of Grace' in relation to a bill of

      exchange refers to:
      A The discount period offered by the bank. Correct Answer Incorrect Answer
      B Three extra days added to the due date for payment. Correct Answer Incorrect Answer
      C The period between the drawing and accepting of the bill. Correct Answer Incorrect Answer
      D The period for noting and protesting a dishonored bill. Correct Answer Incorrect Answer

      Solution

      As per the Negotiable Instruments Act, 1881, three days of grace are added to the nominal due date (period of the bill) to arrive at the date of maturity for payment, unless the bill is payable on demand.

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