Question 1

A principal does not have the right to control an agent's conduct in matters entrusted to the agent.

Accepted Answer

A) True 
 B)False

Question 2

An agent's deviation from the lawful,clearly stated instructions of the principal is a violation of the duty of obedience.

Accepted Answer

A) True 
 B)False

Question 3

If a principal is undisclosed,the agent may be liable to the principal for a third party's nonperformance of a contract.

Accepted Answer

A) True 
 B)False

Question 4

If a principal is disclosed,the agent may be liable to a third party for the principal's nonperformance of a contract.

Accepted Answer

A) True 
 B)False

Question 5

A familiar example of an agent is the owner of a corporation.

Accepted Answer

A) True 
 B)False

Question 6

A power of attorney can permit an agent to transact all business for a principal.

Accepted Answer

A) True 
 B)False

Question 7

Alexandra manages a Beans Bistro for Coffee Shops,Inc. To manage the business,Alexandra's authority can be inferred

Accepted Answer

A) from the position Alexandra occupies. 
B) by a reasonable customer or supplier. 
C) to contradict Alexandra's express authority. 
D) under no circumstances. 
A) from the position Alexandra occupies. 
B) by a reasonable customer or supplier. 
C) to contradict Alexandra's express authority. 
D) under no circumstances.

Question 8

Through agents,a principal can conduct only one business operation at a time.

Accepted Answer

A) True 
 B)False

Question 9

For an agent's implied authority to be effective,aprincipal must confirm it in writing.

Accepted Answer

A) True 
 B)False

Question 10

Under the law of agency,notice to the agent is notice to the principal.

Accepted Answer

A) True 
 B)False

Question 11

Without authorization,Rolf contracts on behalf of Sari to have Tige paint the interior and exterior of Sari's house. Sari ratifies the contract. Later,Sari tries to rescind the part of the contract re-lat-ing to the exterior. This attempt will be

Accepted Answer

A) partly successful. 
B) partly unsuccessful. 
C) totally successful. 
D) totally unsuccessful. 
A) partly successful. 
B) partly unsuccessful. 
C) totally successful. 
D) totally unsuccessful.

Question 12

Orina hires Padget,a real estate broker,to sell her oceanfront house. The house is destroyed in a hurricane be-fore being sold. Padgetis

Accepted Answer

A) Orina's agent until Orina's insurer pays Padget'scommission. 
B) Orina's agent until the destroyed house is sold. 
C) Orina's agent until the destroyed house is rebuilt and sold. 
D) no longer Orina's agent. 
A) Orina's agent until Orina's insurer pays Padget'scommission. 
B) Orina's agent until the destroyed house is sold. 
C) Orina's agent until the destroyed house is rebuilt and sold. 
D) no longer Orina's agent.

Exam 27: Agency Relationships in Business

A principal does not have the right to control an agent's conduct in matters entrusted to the agent.

An agent's deviation from the lawful,clearly stated instructions of the principal is a violation of the duty of obedience.

If a principal is undisclosed,the agent may be liable to the principal for a third party's nonperformance of a contract.

If a principal is disclosed,the agent may be liable to a third party for the principal's nonperformance of a contract.

A familiar example of an agent is the owner of a corporation.

A power of attorney can permit an agent to transact all business for a principal.

Alexandra manages a Beans Bistro for Coffee Shops,Inc. To manage the business,Alexandra's authority can be inferred

Through agents,a principal can conduct only one business operation at a time.

For an agent's implied authority to be effective,aprincipal must confirm it in writing.

Under the law of agency,notice to the agent is notice to the principal.

Without authorization,Rolf contracts on behalf of Sari to have Tige paint the interior and exterior of Sari's house. Sari ratifies the contract. Later,Sari tries to rescind the part of the contract re-lat-ing to the exterior. This attempt will be

Orina hires Padget,a real estate broker,to sell her oceanfront house. The house is destroyed in a hurricane be-fore being sold. Padgetis

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