Question 1

An agency relationship is enforceable even if it is created for a purpose that is contrary to public policy.​

Accepted Answer

A) True 
 B)False

Question 2

Employers cannot avoid any tax liabilities by hiring independent contractors instead of employees.​

Accepted Answer

A) True 
 B)False

Question 3

Lena is a salesperson for Musical Instruments, Inc. She tells Nayda, a customer, that an instrument has a certain quality when, as Lena knows, it does not. In reliance, Nayda buys the instrument. Liable for this misrepresentation is​

Accepted Answer

A)   ​no one.
B)   ​Lena.
C)   ​Musical Instruments.
D)   ​Nayda.E) All of the above
F) A) and B)

Question 4

Spicy Hot Dog Vendors, Inc., grants its agent Teona an exclusive territory in which to sell Spicy products. Spicy's attempt to compete with Teona in that territory would most likely violate​

Accepted Answer

A)   ​the duty of compensation.
B)   ​the duty of cooperation.
C)   ​the duty of indemnification.
D)   ​no duty.E) A) and B)
F) A) and C)

Question 5

If an agent has no authority but nevertheless contracts with a third party, the principal cannot normally be held liable on the contract.​

Accepted Answer

A) True 
 B)False

Question 6

A partially disclosed principal is only partially liable to a third party for a contract made by an agent.​

Accepted Answer

A) True 
 B)False

Question 7

An agent's duties to the principal are implied from the agency relationship only if the identity of the principal is disclosed to a third party.​

Accepted Answer

A) True 
 B)False

Question 8

Bayou Development Corporation hires Coastal Brokerage Associates to sell the condominiums in a building at Bayou Development's resort. The agency will terminate​

Accepted Answer

A)   ​after the condos have been sold.
B)   ​if the prices of the condos must be reduced to sell them.
C)   ​once Bayou Development obtains insurance to cover the property.
D)   ​when Bayou Development pays Coastal Brokerage its first commission.E) A) and D)
F) None of the above

Question 9

Orin hires Pat, a real estate broker, to sell her oceanfront house. The house is destroyed in a hurricane before being sold. Pat is Orin's agent​

Accepted Answer

A)   ​until Orin's insurer pays Pat's commission.
B)   ​until the destroyed house is sold.
C)   ​until the destroyed house is rebuilt and sold.
D)   ​no more.E) None of the above
F) B) and C)

Question 10

The relationship between an employer and an employee cannot involve an agency relationship.​

Accepted Answer

A) True 
 B)False

Question 11

Olive, an agent for Precision Paving Corporation, enters into an unauthorized contract with Quality Asphalt, Inc., purportedly on Precision's behalf. Precision does not ratify the contract. Liability may be imposed on​

Accepted Answer

A)   Olive to Quality for misrepresenting her authority.​
B)   ​Precision to Quality for not ratifying the contract.
C)   ​Quality to Precision for entering into an unauthorized contract.
D)   ​Precision to Olive for not ratifying the contract.E) A) and B)
F) A) and C)

Question 12

A principal is not bound to an unauthorized contract unless the principal ratifies it.​

Accepted Answer

A) True 
 B)False

Exam 17: Agency Relationships in Business

An agency relationship is enforceable even if it is created for a purpose that is contrary to public policy.

Correct Answer
verified

Olive, an agent for Precision Paving Corporation, enters into an unauthorized contract with Quality Asphalt, Inc., purportedly on Precision's behalf. Precision does not ratify the contract. Liability may be imposed on

Correct Answer
verified

Orin hires Pat, a real estate broker, to sell her oceanfront house. The house is destroyed in a hurricane before being sold. Pat is Orin's agent

Correct Answer
verified

An agent's duties to the principal are implied from the agency relationship only if the identity of the principal is disclosed to a third party.

Correct Answer
verified

Spicy Hot Dog Vendors, Inc., grants its agent Teona an exclusive territory in which to sell Spicy products. Spicy's attempt to compete with Teona in that territory would most likely violate

Correct Answer
verified

If an agent has no authority but nevertheless contracts with a third party, the principal cannot normally be held liable on the contract.

Correct Answer
verified

Lena is a salesperson for Musical Instruments, Inc. She tells Nayda, a customer, that an instrument has a certain quality when, as Lena knows, it does not. In reliance, Nayda buys the instrument. Liable for this misrepresentation is

Correct Answer
verified

A partially disclosed principal is only partially liable to a third party for a contract made by an agent.

Correct Answer
verified

A principal is not bound to an unauthorized contract unless the principal ratifies it.

Correct Answer
verified

The relationship between an employer and an employee cannot involve an agency relationship.

Correct Answer
verified

Employers cannot avoid any tax liabilities by hiring independent contractors instead of employees.

Correct Answer
verified

Bayou Development Corporation hires Coastal Brokerage Associates to sell the condominiums in a building at Bayou Development's resort. The agency will terminate

Correct Answer
verified

Exam 17: Agency Relationships in Business

An agency relationship is enforceable even if it is created for a purpose that is contrary to public policy.​

Correct AnswerverifiedShow Answer

Olive, an agent for Precision Paving Corporation, enters into an unauthorized contract with Quality Asphalt, Inc., purportedly on Precision's behalf. Precision does not ratify the contract. Liability may be imposed on​

Correct AnswerverifiedShow Answer

Orin hires Pat, a real estate broker, to sell her oceanfront house. The house is destroyed in a hurricane before being sold. Pat is Orin's agent​

Correct AnswerverifiedShow Answer

An agent's duties to the principal are implied from the agency relationship only if the identity of the principal is disclosed to a third party.​

Correct AnswerverifiedShow Answer

Spicy Hot Dog Vendors, Inc., grants its agent Teona an exclusive territory in which to sell Spicy products. Spicy's attempt to compete with Teona in that territory would most likely violate​

Correct AnswerverifiedShow Answer

If an agent has no authority but nevertheless contracts with a third party, the principal cannot normally be held liable on the contract.​

Correct AnswerverifiedShow Answer

Lena is a salesperson for Musical Instruments, Inc. She tells Nayda, a customer, that an instrument has a certain quality when, as Lena knows, it does not. In reliance, Nayda buys the instrument. Liable for this misrepresentation is​

Correct AnswerverifiedShow Answer

A partially disclosed principal is only partially liable to a third party for a contract made by an agent.​

Correct AnswerverifiedShow Answer

A principal is not bound to an unauthorized contract unless the principal ratifies it.​

Correct AnswerverifiedShow Answer

The relationship between an employer and an employee cannot involve an agency relationship.​

Correct AnswerverifiedShow Answer

Employers cannot avoid any tax liabilities by hiring independent contractors instead of employees.​

Correct AnswerverifiedShow Answer

Bayou Development Corporation hires Coastal Brokerage Associates to sell the condominiums in a building at Bayou Development's resort. The agency will terminate​

Correct AnswerverifiedShow Answer

An agency relationship is enforceable even if it is created for a purpose that is contrary to public policy.

Correct Answer
verified

Olive, an agent for Precision Paving Corporation, enters into an unauthorized contract with Quality Asphalt, Inc., purportedly on Precision's behalf. Precision does not ratify the contract. Liability may be imposed on

Correct Answer
verified

Orin hires Pat, a real estate broker, to sell her oceanfront house. The house is destroyed in a hurricane before being sold. Pat is Orin's agent

Correct Answer
verified

An agent's duties to the principal are implied from the agency relationship only if the identity of the principal is disclosed to a third party.

Correct Answer
verified

Spicy Hot Dog Vendors, Inc., grants its agent Teona an exclusive territory in which to sell Spicy products. Spicy's attempt to compete with Teona in that territory would most likely violate

Correct Answer
verified

If an agent has no authority but nevertheless contracts with a third party, the principal cannot normally be held liable on the contract.

Correct Answer
verified

Lena is a salesperson for Musical Instruments, Inc. She tells Nayda, a customer, that an instrument has a certain quality when, as Lena knows, it does not. In reliance, Nayda buys the instrument. Liable for this misrepresentation is

Correct Answer
verified

A partially disclosed principal is only partially liable to a third party for a contract made by an agent.

Correct Answer
verified

A principal is not bound to an unauthorized contract unless the principal ratifies it.

Correct Answer
verified

The relationship between an employer and an employee cannot involve an agency relationship.

Correct Answer
verified

Employers cannot avoid any tax liabilities by hiring independent contractors instead of employees.

Correct Answer
verified

Bayou Development Corporation hires Coastal Brokerage Associates to sell the condominiums in a building at Bayou Development's resort. The agency will terminate

Correct Answer
verified