Question 1

Sarah hired Karen to manage her campaign for the next six months and promised not to hire anyone else for the position.The parties agreed Karen will work for Sarah until the end of the campaign and can only work for Sarah's campaign.What kind of agency was created?

Accepted Answer

A)  An agency by ratification
B)  An agency was not created.
C)  An apparent agency
D)  An agency by implied authority
E)  An exclusive agency contract

Question 2

In the text case Uber v.Berwick,a driver for a car service argued she was an employee and not an independent contractor,and sought overtime pay and reimbursement for on-the-job expenses.Which of the following was the result?

Accepted Answer

A)  Drivers were employees because the car service was involved in every aspect of the operation.
B)  Drivers were independent contractors because they could work hours of their choosing.
C)  Drivers were independent contractors because they drove their own vehicles.
D)  Drivers were independent contractors because they can choose which clients to serve.
E)  The court declined to determine whether drivers were employees or independent contractors.

Question 3

When parties form an agency relationship by making a written or oral agreement,the agency is known as a[n] ________.

Accepted Answer

A)  Ratification
B)  Apparent agency
C)  Expressed agency
D)  Endorsement
E)  Implied agency

Question 4

A principal may not enact a power of attorney after becoming incompetent.

Accepted Answer

A) True 
 B)False

Question 5

What duty does a principal have concerning safe working conditions?

Accepted Answer

A)  The principal only has a duty to warn agents of known unsafe working conditions.
B)  The principal has a duty to provide safe working conditions for the agent,but he does not need to warn the agency of any known unsafe working conditions.
C)  The principal has a duty to provide safe working conditions for the agent,warn the agent of any known unsafe working conditions,and make necessary repairs.
D)  The principal only has a duty to make necessary repairs to maintain safe working conditions.
E)  The principal does not owe a duty of safe working conditions to an agent.

Question 6

Discuss why agency is especially important for modern firms doing business in foreign countries.

Accepted Answer

While foreign countries offer fresh mark...

Question 7

What should Melanie seek if she wants possession of the lakeside lot Kumar purchased?

Accepted Answer

A)  A defined trust
B)  An absolute trust
C)  A constructive trust
D)  An actual trust
E)  A resolute trust

Question 8

Under which of the following does a principal give authority to an agent only for the specific areas or purposes listed in the agency agreement?

Accepted Answer

A)  A specific power of order
B)  A limited power of responeat superior
C)  An exact legal empowerment
D)  An exact order of authority
E)  A specific power of attorney

Question 9

According to the text,under the duty of accounting,what does an agent owe the principal?

Accepted Answer

Under the duty of accounting,the agent m...

Question 10

An agency relationship may be created only for a lawful purpose.

Accepted Answer

A) True 
 B)False

Question 11

One who acts without consideration is called a gratuitous agent.

Accepted Answer

A) True 
 B)False

Question 12

Which of the following is the most likely result if Kumar sues Melanie for the $300 paid to Rick?

Accepted Answer

A)  Kumar will win only if he can establish by a preponderance of the evidence that he acted reasonably.
B)  Kumar will lose.
C)  Kumar will lose only if Melanie can establish that Rick is incompetent to deal in real estate.
D)  Kumar will win because an agent has an implied right to obtain help.
E)  Kumar will win unless Melanie can establish beyond a reasonable doubt that he acted unreasonably.

Question 13

Which of the following types of agency occurs when a principal leads a third party to believe another individual serves as his or her agent,but the principal has actually made no agreement with the so-called agent?

Accepted Answer

A)  Ratification
B)  Endorsement
C)  Apparent agency
D)  Expressed agency
E)  Implied agency

Question 14

Which of the following refers to the agent's duty to act in the best interest of the principal?

Accepted Answer

A)  Notification
B)  Accounting
C)  Obedience
D)  Specific performance
E)  Loyalty

Question 15

Which of the following is the term used to describe the duty an agent has to follow the lawful instruction and direction of the principal?

Accepted Answer

A)  Express duty of action
B)  Duty of performance
C)  Duty of obedience
D)  Duty of action
E)  Duty of contract

Question 16

Agents in Australia are obligated to act personally on behalf of the principal.

Accepted Answer

A) True 
 B)False

Question 17

Which of the following is false regarding the duties a principal owes to an agent?

Accepted Answer

A)  The principal owes a duty of cooperation to the agent.
B)  The principal can do nothing to interfere with the reasonable conduct of an agent.
C)  The principal must assist the agent in the performance of his or her duties.
D)  The duty of reimbursement applies to employees only,not to independent contractors.
E)  The principal has a duty to provide safe working conditions for an agent.

Question 18

Which of the following would an agent seek in order to attempt to force the principal to perform the contract as stipulated,when a contract exists and a principal agrees to certain conditions,but fails to perform?

Accepted Answer

A)  Adequate performance
B)  Specific performance
C)  Reformation
D)  Recognition
E)  Specific recoupment

Question 19

A is a written document,created by a principal,expressing his or her wishes for an agent's authority not to be affected by the principal's subsequent incapacity.

Accepted Answer

A)  Lasting power of authority
B)  Durable power of attorney
C)  Living legal empowerment
D)  Notarized order
E)  General purpose order of authority

Question 20

When an agent breaches an agency contract,the principal may use his or her right of _ to nullify at his or her discretion any contract the agent negotiated.

Accepted Answer

A)  Rejection
B)  Avoidance
C)  First refusal
D)  Override
E)  Indemnification

Exam 33: Agency Formation and Duties

Which of the following is the most likely result if Kumar sues Melanie for the $300 paid to Rick?

Correct AnswerverifiedShow Answer

An agency relationship may be created only for a lawful purpose.

Correct AnswerverifiedShow Answer

Under which of the following does a principal give authority to an agent only for the specific areas or purposes listed in the agency agreement?

Correct AnswerverifiedShow Answer

A principal may not enact a power of attorney after becoming incompetent.

Correct AnswerverifiedShow Answer

When parties form an agency relationship by making a written or oral agreement,the agency is known as a[n] ________.

Correct AnswerverifiedShow Answer

One who acts without consideration is called a gratuitous agent.

Correct AnswerverifiedShow Answer

Discuss why agency is especially important for modern firms doing business in foreign countries.

Correct AnswerverifiedWhile foreign countries offer fresh mark...View AnswerShow Answer

What duty does a principal have concerning safe working conditions?

Correct AnswerverifiedShow Answer

What should Melanie seek if she wants possession of the lakeside lot Kumar purchased?

Correct AnswerverifiedShow Answer

According to the text,under the duty of accounting,what does an agent owe the principal?

Correct AnswerverifiedUnder the duty of accounting,the agent m...View AnswerShow Answer

Which of the following would an agent seek in order to attempt to force the principal to perform the contract as stipulated,when a contract exists and a principal agrees to certain conditions,but fails to perform?

Correct AnswerverifiedShow Answer

In the text case Uber v.Berwick,a driver for a car service argued she was an employee and not an independent contractor,and sought overtime pay and reimbursement for on-the-job expenses.Which of the following was the result?

Correct AnswerverifiedShow Answer

Agents in Australia are obligated to act personally on behalf of the principal.

Correct AnswerverifiedShow Answer

Which of the following is the term used to describe the duty an agent has to follow the lawful instruction and direction of the principal?

Correct AnswerverifiedShow Answer

Which of the following refers to the agent's duty to act in the best interest of the principal?

Correct AnswerverifiedShow Answer

A is a written document,created by a principal,expressing his or her wishes for an agent's authority not to be affected by the principal's subsequent incapacity.

Correct AnswerverifiedShow Answer

When an agent breaches an agency contract,the principal may use his or her right of _ to nullify at his or her discretion any contract the agent negotiated.

Correct AnswerverifiedShow Answer

Sarah hired Karen to manage her campaign for the next six months and promised not to hire anyone else for the position.The parties agreed Karen will work for Sarah until the end of the campaign and can only work for Sarah's campaign.What kind of agency was created?

Correct AnswerverifiedShow Answer

Which of the following is false regarding the duties a principal owes to an agent?

Correct AnswerverifiedShow Answer

Which of the following types of agency occurs when a principal leads a third party to believe another individual serves as his or her agent,but the principal has actually made no agreement with the so-called agent?

Correct AnswerverifiedShow Answer

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While foreign countries offer fresh mark...
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Under the duty of accounting,the agent m...
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