Question 1

The duty of ____ requires an agent to place the principal's interests before the agent's personal interests or those of any third party:

Accepted Answer

A)  accounting 
B)  indemnity 
C)  performance 
D)  reasonable care 
E)  none of the other choices 
A)  accounting 
B)  indemnity 
C)  performance 
D)  reasonable care 
E)  none of the other choices

Question 2

An agency may not be ended by:

Accepted Answer

A)  unilateral notice by the agent 
B)  unilateral notice by the principal 
C)  mutual consent by agent and principal 
D)  lapse of agreed-upon time 
E)  decision of a third party opposed to the agency 
A)  unilateral notice by the agent 
B)  unilateral notice by the principal 
C)  mutual consent by agent and principal 
D)  lapse of agreed-upon time 
E)  decision of a third party opposed to the agency

Question 3

If a payment amount is not specified in the agency agreement, a principal's duty to compensate means that the principal must pay the agent:

Accepted Answer

A)  however much the agent's attorney demands 
B)  at least half the customary rate 
C)  for the rational value of the services provided 
D)  however much the agent demands 
E)  none of the other choices are correct 
A)  however much the agent's attorney demands 
B)  at least half the customary rate 
C)  for the rational value of the services provided 
D)  however much the agent demands 
E)  none of the other choices are correct

Question 4

If you hire a builder to build a home, he is likely an independent contractor for you.

Accepted Answer

A) True 
 B)False

Question 5

Implied ratification of an agency occurs when the principal:

Accepted Answer

A)  fails to object to the unauthorized activities of an agent 
B)  by action shows a clear intent to be bound by unauthorized acts of the agent 
C)  accepts the benefits of an unauthorized agreement with a third party 
D)  fails to object to the unauthorized activities of an agent and accepts the benefits of an unauthorized agreement with a third party 
E)  fails to object to the unauthorized activities of an agent and accepts the benefits of an unauthorized agreement with a third party and by action shows a clear intent to be bound by unauthorized acts of the agent 
A)  fails to object to the unauthorized activities of an agent 
B)  by action shows a clear intent to be bound by unauthorized acts of the agent 
C)  accepts the benefits of an unauthorized agreement with a third party 
D)  fails to object to the unauthorized activities of an agent and accepts the benefits of an unauthorized agreement with a third party 
E)  fails to object to the unauthorized activities of an agent and accepts the benefits of an unauthorized agreement with a third party and by action shows a clear intent to be bound by unauthorized acts of the agent

Question 6

A person who volunteers with no expectation of being paid for her services is a(n):

Accepted Answer

A)  exceptional agent 
B)  universal agent 
C)  agent who has an agency coupled with an interest 
D)  special agent 
E)  none of the other choices 
A)  exceptional agent 
B)  universal agent 
C)  agent who has an agency coupled with an interest 
D)  special agent 
E)  none of the other choices

Question 7

Agency relationships may be based on an oral agreement.

Accepted Answer

A) True 
 B)False

Question 8

An agent's ____ is the power to change the principal's legal obligations.

Accepted Answer

A)  legal right 
B)  official power 
C)  authorization 
D)  responsibility 
E)  none of the other choices are correct 
A)  legal right 
B)  official power 
C)  authorization 
D)  responsibility 
E)  none of the other choices are correct

Question 9

An independent contractor:

Accepted Answer

A)  by law may not serve as an agent for the same employer 
B)  is not liable for torts committed in the course of employment 
C)  may not make contracts on behalf of an employer 
D)  may not work more than one month in any year for one employer 
E)  none of the other choices 
A)  by law may not serve as an agent for the same employer 
B)  is not liable for torts committed in the course of employment 
C)  may not make contracts on behalf of an employer 
D)  may not work more than one month in any year for one employer 
E)  none of the other choices

Question 10

Many states require agencies for ____ to be established in writing.

Accepted Answer

A)  sale of boats 
B)  sale of businesses 
C)  sale of land 
D)  sale of livestock 
E)  sale of books 
A)  sale of boats 
B)  sale of businesses 
C)  sale of land 
D)  sale of livestock 
E)  sale of books

Question 11

A senior manager at Don Reid Ford is an example of a(n):

Accepted Answer

A)  agent 
B)  employee 
C)  employee with agency powers 
D)  independent contractor 
E)  agent and independent contractor 
A)  agent 
B)  employee 
C)  employee with agency powers 
D)  independent contractor 
E)  agent and independent contractor

Question 12

Scott is an agent for Lee and his duties require him to fly to Chicago from Cleveland. Scott gets up late and misses his flight to Chicago so he has to buy a second plane ticket. As principal, Lee:

Accepted Answer

A)  has a duty to reimburse Scott for the second plane ticket 
B)  does not have a duty to reimburse Scott for the second plane ticket because it was Scott's fault he had to buy it 
C)  has a duty to reimburse Scott for half the plane ticket 
D)  has a duty to reimburse Scott for 1/3 of the plane ticket 
E)  does not have a duty to reimburse Scott for the ticket because he had no duty to reimburse Scott for a plane ticket to Chicago anyway 
A)  has a duty to reimburse Scott for the second plane ticket 
B)  does not have a duty to reimburse Scott for the second plane ticket because it was Scott's fault he had to buy it 
C)  has a duty to reimburse Scott for half the plane ticket 
D)  has a duty to reimburse Scott for 1/3 of the plane ticket 
E)  does not have a duty to reimburse Scott for the ticket because he had no duty to reimburse Scott for a plane ticket to Chicago anyway

Question 13

The principal is possibly liable for the torts of the agent if the agent's tort was:

Accepted Answer

A)  authorized by the principal 
B)  an unauthorized intentional tort outside the scope of the agent's employment 
C)  an unauthorized intentional tort within the scope of the agent's employment 
D)  authorized by the principal or an unauthorized intentional tort within the scope of the agent's employment 
E)  authorized by the principal or an unauthorized intentional tort within the scope of the agent's employment or an unauthorized intentional tort outside the scope of the agent's employment 
A)  authorized by the principal 
B)  an unauthorized intentional tort outside the scope of the agent's employment 
C)  an unauthorized intentional tort within the scope of the agent's employment 
D)  authorized by the principal or an unauthorized intentional tort within the scope of the agent's employment 
E)  authorized by the principal or an unauthorized intentional tort within the scope of the agent's employment or an unauthorized intentional tort outside the scope of the agent's employment

Question 14

To establish an agency relationship:

Accepted Answer

A)  the procedure in state statutes must be followed 
B)  there must be a written contract between the parties 
C)  the principal must file an agency charter with the appropriate state agency 
D)  all of the other specific choices 
E)  none of the other choices 
A)  the procedure in state statutes must be followed 
B)  there must be a written contract between the parties 
C)  the principal must file an agency charter with the appropriate state agency 
D)  all of the other specific choices 
E)  none of the other choices

Question 15

In France v. Southern Equipment Co., where France, after falling off a roof, sued Southern Equipment Co. who had employed Quality Metal Roof, a company that contracted with France's employer, Royalty Builders, to build them a new metal roof for exposing him to the inherently dangerous job of roofing, the appeals court held that:

Accepted Answer

A)  Southern Equipment was liable because they engaged Royalty Builders to do the work 
B)  Southern Equipment was not liable because they engaged Royalty Builders to do the work and in doing so passed the liability to Royalty Builders 
C)  Southern Equipment was liable even though they did not engage Royalty Builders to do the work 
D)  Southern Equipment was not liable because they did not engage Royalty Builders to do the work and they had no control over Royalty Builders 
E)  Southern Equipment was not liable because France was a minor and should not have been working in construction 
A)  Southern Equipment was liable because they engaged Royalty Builders to do the work 
B)  Southern Equipment was not liable because they engaged Royalty Builders to do the work and in doing so passed the liability to Royalty Builders 
C)  Southern Equipment was liable even though they did not engage Royalty Builders to do the work 
D)  Southern Equipment was not liable because they did not engage Royalty Builders to do the work and they had no control over Royalty Builders 
E)  Southern Equipment was not liable because France was a minor and should not have been working in construction

Question 16

An undisclosed principal is a principal whose identity is unknown to the third party with whom the agent is involved.

Accepted Answer

A) True 
 B)False

The duty of ____ requires an agent to place the principal's interests before the agent's personal interests or those of any third party:

An agency may not be ended by:

If a payment amount is not specified in the agency agreement, a principal's duty to compensate means that the principal must pay the agent:

If you hire a builder to build a home, he is likely an independent contractor for you.

Implied ratification of an agency occurs when the principal:

A person who volunteers with no expectation of being paid for her services is a(n):

Agency relationships may be based on an oral agreement.

An agent's ____ is the power to change the principal's legal obligations.

An independent contractor:

Many states require agencies for ____ to be established in writing.

A senior manager at Don Reid Ford is an example of a(n):

Scott is an agent for Lee and his duties require him to fly to Chicago from Cleveland. Scott gets up late and misses his flight to Chicago so he has to buy a second plane ticket. As principal, Lee:

The principal is possibly liable for the torts of the agent if the agent's tort was:

To establish an agency relationship:

An undisclosed principal is a principal whose identity is unknown to the third party with whom the agent is involved.

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Exam 14: Agency and the Employment Relationship

The duty of ____ requires an agent to place the principal's interests before the agent's personal interests or those of any third party:

An agency may not be ended by:

If a payment amount is not specified in the agency agreement, a principal's duty to compensate means that the principal must pay the agent:

If you hire a builder to build a home, he is likely an independent contractor for you.

Implied ratification of an agency occurs when the principal:

A person who volunteers with no expectation of being paid for her services is a(n):

Agency relationships may be based on an oral agreement.

An agent's ____ is the power to change the principal's legal obligations.

An independent contractor:

Many states require agencies for ____ to be established in writing.

A senior manager at Don Reid Ford is an example of a(n):

Scott is an agent for Lee and his duties require him to fly to Chicago from Cleveland. Scott gets up late and misses his flight to Chicago so he has to buy a second plane ticket. As principal, Lee:

The principal is possibly liable for the torts of the agent if the agent's tort was:

To establish an agency relationship:

An undisclosed principal is a principal whose identity is unknown to the third party with whom the agent is involved.

Todays Business Environment: Law and Ethics

The Court Systems

Trials and Resolving Disputes

The Constitution: Focus on Application to Business

Criminal Law and Business

Elements of Torts

Business Torts and Product Liability

Real and Personal Property

Intellectual Property

Contracts

Domestic and International Sales

Business Organizations

Negotiable Instruments, Credit, and Bankruptcy

Employment and Labor Regulations

Employment Discrimination

The Regulatory Process

Securities Regulation

Consumer Protection

Antitrust Law

Environmental Law

The International Legal Environment of Business

Filters