Question 1

The principal is liable for all torts of independent contractors.

Accepted Answer

A) True 
 B)False

Question 2

An orally agreed upon power of attorney is acceptable in court.

Accepted Answer

A) True 
 B)False

Question 3

If an agency terminates by operation of law, there is no duty to notify third parties about the termination.

Accepted Answer

A) True 
 B)False

Question 4

Why can an agent not take an opportunity meant for the principal? When is an agent permitted to take such an opportunity? Give an illustration depicting an agent's violation of his or her duty of loyalty.

Accepted Answer

An agent cannot personally usurp an oppo

Question 5

Ronald, the purchasing manager of Tellys Supermarket in Georgia, was asked to buy an order of the latest videogame console, FunCase, to keep in the supermarket. However, due to a truckers' strike, he had to make a trip to the FunCase warehouse, which was in Florida. Ronald paid for the trip himself, went to the warehouse, procured the shipment, and returned. After he got back, Tellys Supermarket paid Ronald for the trip he made to Florida. What duty of the principal did Tellys Supermarket perform here when they paid Ronald for the trip to Florida?

Accepted Answer

A)  duty to cooperate 
B)  duty to reimburse 
C)  duty to compensate 
D)  duty to indemnify 
A)  duty to cooperate 
B)  duty to reimburse 
C)  duty to compensate 
D)  duty to indemnify

Question 6

A dual-purpose mission is a situation that occurs when ________.

Accepted Answer

A)  an agent works for two or more principals with conflicting interests 
B)  a principal requests an agent to run an errand when the agent is on his or her own personal business 
C)  an agent who works for more than two principals but has similar agency relationships with both 
D)  an agent competes with the principal in a business with interests similar to the principal's business, after their agency has ended 
A)  an agent works for two or more principals with conflicting interests 
B)  a principal requests an agent to run an errand when the agent is on his or her own personal business 
C)  an agent who works for more than two principals but has similar agency relationships with both 
D)  an agent competes with the principal in a business with interests similar to the principal's business, after their agency has ended

Question 7

Which of the following is a fiduciary duty owed by an agent not to act adversely to the interests of the principal?

Accepted Answer

A)  duty of loyalty 
B)  duty of undertaking 
C)  duty of discharge 
D)  duty of resolution 
A)  duty of loyalty 
B)  duty of undertaking 
C)  duty of discharge 
D)  duty of resolution

Question 8

Which of the following describes an agency by estoppel?

Accepted Answer

A)  an agency that arises when a principal ratifies a contract created by an unauthorized agent 
B)  an agency created when a principal and an agent expressly agree to enter into an agency agreement 
C)  an agency that is not expressly stated but is implied and inferred in the conduct of the parties 
D)  an agency that arises when a principal creates the appearance of an agency that in actuality does not exist 
A)  an agency that arises when a principal ratifies a contract created by an unauthorized agent 
B)  an agency created when a principal and an agent expressly agree to enter into an agency agreement 
C)  an agency that is not expressly stated but is implied and inferred in the conduct of the parties 
D)  an agency that arises when a principal creates the appearance of an agency that in actuality does not exist

Question 9

An agent does not owe a duty to notify the principal of important information he learns concerning the agency.

Accepted Answer

A) True 
 B)False

Question 10

If a casting agent works for two Hollywood actors, the agent is liable for ________.

Accepted Answer

A)  dual agency 
B)  competing with the principal 
C)  usurping an opportunity 
D)  self-dealing 
A)  dual agency 
B)  competing with the principal 
C)  usurping an opportunity 
D)  self-dealing

Question 11

An agent is liable for the tortious conduct of the principal if he or she has knowledge of the principal's conduct.

Accepted Answer

A) True 
 B)False

Question 12

Martin, who wants to sell a house he owns, authorizes his concierge, Wilhelm, to find a potential buyer, and finalize a deal above a stipulated price. Wilhelm contracts Chris, a real estate broker, and intends him to only find a potential buyer and send them over to Wilhelm for the sale. Martin then contracts ReNowait Goodhouses, a home improvement company to renovate the house. ReNowait completes their work and Martin pays them. Chris then searches for a suitable buyer and finds one in George. George buys the house and Chris is paid for his services.
-What role does Chris perform?

Accepted Answer

A)  independent contractor 
B)  agent 
C)  principal 
D)  trustee 
A)  independent contractor 
B)  agent 
C)  principal 
D)  trustee

Question 13

A car salesperson is employed to sell the principal's car, and the principal tells the agent that the car was repaired after it was involved in a major accident. If the agent intentionally tells the buyer that the car was never involved in an accident, the agent has committed the tort of ________.

Accepted Answer

intentiona

Question 14

Which of the following qualifies as termination of an agency by impossibility of performance?

Accepted Answer

A)  the loss of a required qualification 
B)  the bankruptcy of the principal 
C)  the insanity of either the principal or the agent 
D)  the conviction of either the principal or the agent 
A)  the loss of a required qualification 
B)  the bankruptcy of the principal 
C)  the insanity of either the principal or the agent 
D)  the conviction of either the principal or the agent

Question 15

An employer-employee relationship occurs when an employer gives an employee authority to act and enter into contracts on his or her behalf.

Accepted Answer

A) True 
 B)False

Question 16

In which of the following cases is a motivation test used to establish the employee's motive?

Accepted Answer

A)  An employee commits a tort to promote the principal's business, outside work premises. 
B)  An employee commits an intentional tort against another employee at work premises. 
C)  An employee commits an unintentional tort that helps promote the principal's business. 
D)  An employee assaults another employee due to personal reasons. 
A)  An employee commits a tort to promote the principal's business, outside work premises. 
B)  An employee commits an intentional tort against another employee at work premises. 
C)  An employee commits an unintentional tort that helps promote the principal's business. 
D)  An employee assaults another employee due to personal reasons.

Question 17

A constructive trust helps the agent retain profits made during the completion of the agency.

Accepted Answer

A) True 
 B)False

Question 18

Which of the following types of relationship exists when a person hires another person to perform some form of physical service but does not authorize that person to enter into contracts on behalf his or her behalf?

Accepted Answer

A)  employer-employee relationship 
B)  employer-agent relationship 
C)  principal-third party relationship 
D)  principal-agent relationship 
A)  employer-employee relationship 
B)  employer-agent relationship 
C)  principal-third party relationship 
D)  principal-agent relationship

Question 19

Undisclosed agencies are not lawful in the United States.

Accepted Answer

A) True 
 B)False

Question 20

The principal is liable for the innocent misrepresentation made by an agent acting within the scope of employment.

Accepted Answer

A) True 
 B)False

Exam 18: Agency Law

The principal is liable for all torts of independent contractors.

An orally agreed upon power of attorney is acceptable in court.

If an agency terminates by operation of law, there is no duty to notify third parties about the termination.

Why can an agent not take an opportunity meant for the principal? When is an agent permitted to take such an opportunity? Give an illustration depicting an agent's violation of his or her duty of loyalty.

A dual-purpose mission is a situation that occurs when ________.

Which of the following is a fiduciary duty owed by an agent not to act adversely to the interests of the principal?

Which of the following describes an agency by estoppel?

An agent does not owe a duty to notify the principal of important information he learns concerning the agency.

If a casting agent works for two Hollywood actors, the agent is liable for ________.

An agent is liable for the tortious conduct of the principal if he or she has knowledge of the principal's conduct.

A car salesperson is employed to sell the principal's car, and the principal tells the agent that the car was repaired after it was involved in a major accident. If the agent intentionally tells the buyer that the car was never involved in an accident, the agent has committed the tort of ________.

Which of the following qualifies as termination of an agency by impossibility of performance?

An employer-employee relationship occurs when an employer gives an employee authority to act and enter into contracts on his or her behalf.

In which of the following cases is a motivation test used to establish the employee's motive?

A constructive trust helps the agent retain profits made during the completion of the agency.

Which of the following types of relationship exists when a person hires another person to perform some form of physical service but does not authorize that person to enter into contracts on behalf his or her behalf?

Undisclosed agencies are not lawful in the United States.

The principal is liable for the innocent misrepresentation made by an agent acting within the scope of employment.

Legal Heritage and the Digital Age

Ethics and Social Responsibility of Business

Courts, Jurisdiction, and Administrative Agencies

Judicial, Alternative, and E-Dispute Resolution

Constitutional Law for Business and E-Commerce

Torts and Strict Liability

Criminal Law and Cyber Crimes

Intellectual Property and Cyber Piracy

Formation of Traditional and E-Contracts

Performance and Breach of Traditional and E-Contracts

E-Commerce and Digital Law

UCC Sales and Lease Contracts and Warranties

Credit, Secured Transactions, and Bankruptcy

Small Business and General and Limited Partnerships

Limited Liability Companies, Limited Liability Partnerships, and Special Forms of Business

Corporations and the Sarbanes-Oxley Act

Investor Protection, E-Securities, and Wall Street Reform

Equal Opportunity in Employment

Employment Law and Worker Protection

Labor Law and Immigration Law

Antitrust Law and Unfair Trade Practices

Consumer Protection

Environmental Protection

Land Use Regulation and Real Property

International and World Trade Law

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