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Business Law Principles and Practices

Business

Quiz 24 :

Principal-Agent Relationship

Quiz 24 :

Principal-Agent Relationship

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To be valid, an agency agreement must be in writing.
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True False
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Answer:

False

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To prevent problems, a principal-agent contract should be in writing.
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True False
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True

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A person hired to sell one's car would be considered a
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Multiple Choice
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Answer:

B

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The bankruptcy of the agent may terminate the agency relationship.
True False
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A principal has a duty to indemnify an agent if the agent gets a speeding ticket while performing the principal's business.
True False
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The major difference between an employee and an independent contractor is the length of time during which services will be performed.
True False
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An agency is created if one person ratifies another's unauthorized act.
True False
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An agent has a duty to follow all lawful instructions of the principal.
True False
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A principal-agency relationship may be used for
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If you hire an agent to sell your house, the agency ends when the house is sold.
True False
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An independent contractor and an agent are basically the same.
True False
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An agency is automatically terminated upon the death of the agent.
True False
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A minor can act as either a principal or an agent.
True False
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Of the following acts, the one that an agent could not perform for a principal is
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The principal continues to be bound by an agent's actions until the principal notifies third parties that the agency has terminated.
True False
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The major difference between an agent who is paid and a gratuitous agent is the
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A special agent is limited in the type of transactions he or she can perform for the principal.
True False
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A person can be both an agent and an employee at the same time.
True False
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Of the following acts, the one that an agent could not perform for the principal would be
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An emergency may create a principal-agent relationship by necessity.
True False
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