Introduction to Agency and Business Organizations
MULTIPLE CHOICE
C. the purported agent assumes personal liability for his or her actions.
D. an apparent agency may exist.
1. Agency is a legal relationship in which
A. the principal acts on behalf of the agent.
B. the principal becomes personally liable for
all actions of the agent.
C. a written contract must specify all authority
of the agent.
D. the agent acts for or represents the principal
by the principal’s authority.
ANS:
ANS:
6. An agent’s duties to the principal include
A. the duty of loyalty.
B. the duty to act without compensation.
C. the duty to perform any tasks requested by
the principal.
D. the duty to compensate the principal.
D
2. When used in relation to the agency relationship, the master
A. retains some control over his or her servant
(employee).
B. gives his or her servant (employee) full
discretion to act on the master’s behalf.
C. hires the employee for a specific task for
which the master is not responsible.
D. is not liable for any actions taken on his or
her behalf by the servant (employee).
ANS:
ANS:
A
ANS:
D
8. A principal is not liable for the torts of his or
her agent if the
A. tort is committed by the agent acting in the
scope of his or her employment by the
principal.
B. agent’s action is unrelated to the agency
relationship.
C. principal is negligent or reckless in supervising the agent.
D. agent is acting under the principal’s direction when committing the tort.
C
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