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Exam 36: Agency

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Question 21

Multiple Choice

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An agent appointed by a power of attorney is referred to as an: ______.

A) ​implied attorney.
B) attorney in fact.
C) ​implied agent.
D) ​attorney at law.

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verified

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Question 22

Multiple Choice

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A third person who deals with a person claiming to be an agent: ______.

A) ​can rely on the statements made by the agent regarding the extent of the authority.
B) cannot ignore any knowledge regarding a limitation of the agent's authority.
C) ​is not required to take notice of any acts clearly adverse to the interest of the principal.
D) ​is bound by the agent's secret limitations, regardless of the third person's knowledge.

Correct Answer

verified

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Question 23

Multiple Choice

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Which of the following is not a necessary condition for ratification?

A(n) ______ is bound by a contract to produce a certain result, with performance of the work controlled by the ______.

If the principal terminates the agency: ______.

An employer does not have control over the performance of the work done by an independent contractor.

The acts of the agent obligate the principal to third persons and give the principal rights against third persons.

An agent's implied authority to perform any act reasonably necessary to execute express authority is called __________ authority.​

The term apparent authority is used when there is: ______.

An agent has an interest in the authority when consideration has been given or paid for the right to exercise the authority.

A(n) _______ gives an agent an interest in the property with which she is dealing.

When an unauthorized act is ratified, the effect is the same as though the act had been originally authorized.

An agent is under a duty to obey: ______.

Barnes agrees with Morgan to enter into the management of a new subdivision of residential housing.Morgan appoints Barnes as his manager for the duration of the development program.During the course of the construction, Barnes decides to use funds specified for the subdivision for an office space project that Barnes alone has been interested in completing.Morgan is very angry on learning of Barnes' actions and terminates the agency.Barnes insists that the agency cannot be terminated in this manner.Is Barnes correct?

A universal agent is authorized by the principal to transact all affairs in connection with a particular type of business or trade or to transact all business at a certain place.

Notification to a principal may be implied when the principal does not object to a contract and accepts its benefits.

Ames, an agent for Baker Antiques, had the authority to purchase early 20th-century American furniture costing a maximum of $1,500 per piece.Ames bought a 19th-century French desk for $3,000 from Carter.Baker was furious when she saw the desk, and she fired Ames.Nevertheless, she put the desk on display in the shop with a $5,000 price tag.When the best offer she got for the desk was $2,500, Baker returned the desk to Carter.Baker told Carter that Ames had exceeded his authority in purchasing the desk, and she demanded that Carter refund the $3,000 that Ames had paid for the desk.Will Carter have to do so?

A __________ agent is authorized by the principal to handle a definite business transaction or to do a specific act.

An agent has incidental authority to perform any act reasonably necessary to execute the express authority given to the agent.

The scope of an agent's authority may be determined from all of the following except: ______.