Question 1

Anyone who is legally competent to act for himself or herself can act as an agent of himself or herself but cannot serve as an agent for another.

Accepted Answer

A legally competent person can act as an agent for themselves and also serve as an agent for another person, provided they have the authority to do so.

Question 2

A person who is delegated the authority to act only in a particular kind of transaction,under definite instructions,and with specific limits on the scope of his or her authority,is called a:

Accepted Answer

A special agent is a person who is authorized to act only in a particular kind of transaction, with specific limits on the scope of their authority. They are given definite instructions and their authority is limited to what is necessary to carry out the transaction. This is in contrast to a general agent who has broader authority to act on behalf of their principal in a more general capacity. A hired agent is a general term that refers to any agent who is hired by a principal to act on their behalf, whether they are a special agent or a general agent. A super agent is not a recognized term in agency law.

Question 3

A person who represents another is known as a principal.

Accepted Answer

A person who represents another is known as an agent, while the person being represented is called the principal.

Question 4

If a person acts as agent for more than one party with their knowledge,the agent is entitled to receive compensation from each principal.

Accepted Answer

This is because the agent is performing separate services for each principal and is entitled to compensation for each service provided. It is important, however, for the agent to disclose to each principal that they are representing multiple parties in the transaction.

Question 5

The legal document formally creating an agency is called a:

Accepted Answer

The legal document formally creating an agency is called a power of attorney. This document gives the agent the authority to act on behalf of the principal in specific or general matters, such as managing finances, making medical decisions or legal transactions. Option A, general contract, is a broad term that refers to any legally binding agreement between two or more parties. Options C and D are not commonly used terms in agency law.

Question 6

An agency by ratification results when a principal approves an unauthorized act performed by an agent.

Accepted Answer

An agency by ratification results when a principal approves an unauthorized act performed by an agent.

Question 7

Express authority is the authority an agent reasonably assumes he or she has that relates to the express authority granted by the principal.

Accepted Answer

Express authority is the authority explicitly granted to an agent by the principal, not assumed by the agent.

Question 8

If minors are capable of properly carrying out the duties of an agency relationship:

Accepted Answer

The capability of a minor to properly carry out agency duties suggests that the minor has the necessary capacity and competence to act as an agent for someone else. Therefore, the minor may be considered to represent other persons as agents. However, this does not necessarily mean that the minor is eligible to enter into a contract with an agent, as contract law imposes some limitations on minors' rights and obligations.

Question 9

Agency is a type of contract and,like other contracts,may be terminated by agreement,by performance,or by operation of law.

Accepted Answer

Agency contracts can be terminated by agreement between the parties, by performance (when the purpose of the agency has been achieved), or by operation of law (such as when the agent becomes disqualified or the principal dies).

Question 10

The legal principles governing the relationship of principal and agent and of employer and employee are entirely different from each other.

Accepted Answer

The legal principles governing the relationship of principal and agent and of employer and employee overlap significantly, as both involve aspects of authority, control, and responsibility, although there are specific distinctions related to the scope and nature of the relationships.

Question 11

A principal must pay the agent the compensation agreed to in the contract.

Accepted Answer

This is the basic principle of agency law. The principal is obligated to pay the agent the compensation or commission agreed upon in the contract.

Question 12

A principal is not responsible to third parties for all agreements made by the agent on behalf of the principal even if the agent acted within the scope of his or her authority.

Accepted Answer

The principal is actually responsible for agreements made by the agent while acting within the scope of his or her authority. This is known as the principle of vicarious liability.

Question 13

When the agent informs the third party that he or she is acting on behalf of another,and makes the third party aware of the identity of the principal,the principal is known as a furtive principal.

Accepted Answer

A furtive principal is one who remains anonymous and undisclosed to the third party, while in this case, the principal's identity is made known to the third party. Therefore, the correct term for this scenario would be a disclosed principal.

Question 14

A principal is liable for the torts and crimes of the agent if they are committed at the direction of the principal or while the agent is performing authorized duties during the ordinary course of the agency.

Accepted Answer

This concept is known as "vicarious liability" or "respondeat superior" and holds the principal responsible for the actions of the agent. However, if the agent acts outside the scope of their authority, the principal may not be held liable.

Question 15

An agency by operation of law is created when a court finds the need for an agency to achieve a desired social policy.

Accepted Answer

An agency by operation of law, sometimes called an "independent agency," is created by Congress when it sees a need for a specialized agency to achieve a desired social policy.

Question 16

It is often necessary or desirable for a person or firm to be represented by another in business or personal dealings with third parties.This relationship is called a(n):

Accepted Answer

The relationship described is that of a principal (person or firm) and an agent (representative) and is therefore best described as a principal-agency relationship.

Question 17

It is not necessary for the agent to obey all of the principal's reasonable and lawful orders and instructions within the scope of the agency contract.

Accepted Answer

It is necessary for the agent to obey all of the principal's reasonable and lawful orders and instructions within the scope of the agency contract as stated in the doctrine of obedience.

Question 18

An agency by invention is created when circumstances make such an agency necessary.

Accepted Answer

The answer of An agency by invention is created when...

Question 19

Agents are usually classified according to the nature of their relationship with their principals.

Accepted Answer

This statement is true. Agents can be classified based on various factors like the nature of their relationship with their principals, the extent of their authority, and the type of business they conduct.

Question 20

Individuals who lack the capacity to enter into contracts on their own are:

Accepted Answer

Minors are individuals who lack the capacity to enter into contracts on their own. This is because they are not yet of legal age and are therefore not legally considered to be fully responsible for their actions. In most cases, minors require the consent of their parents or guardians to enter into contracts.

Quiz 19: Agency

Anyone who is legally competent to act for himself or herself can act as an agent of himself or herself but cannot serve as an agent for another.

A person who is delegated the authority to act only in a particular kind of transaction,under definite instructions,and with specific limits on the scope of his or her authority,is called a:

A person who represents another is known as a principal.

If a person acts as agent for more than one party with their knowledge,the agent is entitled to receive compensation from each principal.

The legal document formally creating an agency is called a:

An agency by ratification results when a principal approves an unauthorized act performed by an agent.

Express authority is the authority an agent reasonably assumes he or she has that relates to the express authority granted by the principal.

If minors are capable of properly carrying out the duties of an agency relationship:

Agency is a type of contract and,like other contracts,may be terminated by agreement,by performance,or by operation of law.

The legal principles governing the relationship of principal and agent and of employer and employee are entirely different from each other.

A principal must pay the agent the compensation agreed to in the contract.

A principal is not responsible to third parties for all agreements made by the agent on behalf of the principal even if the agent acted within the scope of his or her authority.

When the agent informs the third party that he or she is acting on behalf of another,and makes the third party aware of the identity of the principal,the principal is known as a furtive principal.

A principal is liable for the torts and crimes of the agent if they are committed at the direction of the principal or while the agent is performing authorized duties during the ordinary course of the agency.

An agency by operation of law is created when a court finds the need for an agency to achieve a desired social policy.

It is often necessary or desirable for a person or firm to be represented by another in business or personal dealings with third parties.This relationship is called a(n) :

It is not necessary for the agent to obey all of the principal's reasonable and lawful orders and instructions within the scope of the agency contract.

An agency by invention is created when circumstances make such an agency necessary.

Agents are usually classified according to the nature of their relationship with their principals.

Individuals who lack the capacity to enter into contracts on their own are: