Chapter 20 Agency
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Chapter 20 Agency

Course: B 2, Spring 2011

School: Youngstown

Word Count: 2595

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8. Irma retains Jerry as her authorized agent, unaware that Jerry is a minor. Jerry enters into a contract with Ken on Irmas behalf. The contract is a. binding on Irma. b. binding on Jerry and Ken, but not Irma. c. binding on Ken, but not Irma or Jerry. d. void. 9. A court declares Rose to be legally incompetent. Rose can be a. an agent only. b. an agent or a principal. c. a principal only. d. neither an agent...

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Irma 8. retains Jerry as her authorized agent, unaware that Jerry is a minor. Jerry enters into a contract with Ken on Irmas behalf. The contract is a. binding on Irma. b. binding on Jerry and Ken, but not Irma. c. binding on Ken, but not Irma or Jerry. d. void. 9. A court declares Rose to be legally incompetent. Rose can be a. an agent only. b. an agent or a principal. c. a principal only. d. neither an agent nor a principal. 10. Macro Corporation and National Purchasing Company may create an agency agreement a. by conduct, in writing, or orally. b. by conduct or orally only. c. in writing only. d. under no circumstances. 11. Rita is appointed as an agent for Superior Sales, Inc. The agency agreement is silent as to the level of sales that Rita is expected to achieve. She must a. achieve nothing because the agreement says nothing on the issue. b. attain the level that Rita achieved with her previous employer. c. maintain the level Superior attained before Rita became an agent. d. use reasonable diligence and skill in selling. 12. Jay holds himself out as possessing special accounting skills. As an agent, he must exercise the degree of skill or care expected of a. a person having those skills. b. an average, unskilled person. c. a reasonable person.? d. the principal. 13. Prospective Enterprises (PE) employs Quinn to buy property for a possible commercial development. Quinn secretly buys some of the property and sells it to PE at a profit. Quinn has breached a. no duty. b. the duty of accounting. c. the duty of loyalty. d. the duty of notification. 14. of Elle is an agent for Fine Cosmetics, Inc. Elle owes Fine Cosmetics the duty a. avoidance. b. compensation. c. indemnification. d. performance. 15. Hugh is an agent for Industrial Solvents, Inc. Hugh owes Industrial Solvents the duty of a. compensation. b. loyalty. c. reimbursement. d. safe working conditions. 16. Regional Investment Corporation (RIC) hires Sam, a real estate agent, to locate investment properties for RIC. Sam learns of a warehouse available for $100,000, buys it himself, and offers it to RIC for $200,000. Under the reasoning of the court in Case 31.3, Cousins v. Realty Ventures, Inc., Sam a. breached the agents fiduciary duties to the principal. b. did nothing wrong. c. failed to take advantage of a business opportunity. d. set an unreasonable price based on current market value. 17. Mona is an agent for Nationwide Restaurant Corporation (NRC). In acting as an agent, Mona follows all of NRCs clearly stated instructions. This responsibility arises under a. no agents duty. b. the agents duty of loyalty. c. the agents duty of notification. d. the agents duty of obedience. 18. Jody is an agent for Kwik Credit Company (KCC). In the course of Jodys performance for KCC, Jody pays Leo for certain auto maintenance and repair services. Jodys right to obtain the amount of those payments from KCC arises under the principals duty of a. avoidance. b. cooperation. c. indemnification. d. reimbursement. 20. United Sales Corporation hires Victor to act as its agent. Uniteds right not to perform a contract entered into by Victor, if Victor breaches their agency agreement, is the right of a. avoidance. b. indemnification. c. nullification. d. termination. Multiple Choice Identify the letter of the choice that best completes the statement or answers the question. ____ 33. Erin is the agent of Franco, an actor. Erin makes a deal for Franco to act in a new movie for Great Productions, Inc. The contract is binding on Franco if it is signed on his behalf by a. Erin. b. Great Productions. c. the Screen Actors Guild. d. none of the above. ____ 34. American Products, Inc., employs Bill as a salesperson, with the authority to sell American's products at prices that Bill negotiates in the field. With respect to those prices, Bill is a. American's employee only. b. American's employee and agent. c. an independent contractor. d. none of the above. Fact Pattern 31-1 Janet and Julie work at ABC Interiors. Janet is a designer who works with clients of ABC on interior design projects. ABC closely supervises all of its designers, and dictates their work schedules. Julie works part-time in the evenings cleaning the offices. ____ 35. Refer to Fact Pattern 31-1. Janet is ABC's a. employee but not agent. b. employee and agent. c. independent contractor. d. employee, agent, and independent contractor. ____ 36. Refer to Fact Pattern 31-1. Julie is ABC's a. agent but not employee. b. employee and agent. c. independent contractor. d. employee or independent contractor, depending on whether ABC controls the details of her physical performance. ____ 37. Mike is an architect who works for General Construction Company. The most important factor in determining whether Mike is General's employee or an independent contractor is a. the degree of control that General exercises over Mike. b. the distinction between General's business and Mike's occupation. c. the length of the working relationship between General and Mike. d. the method of payment. ____ 38. Warren hires Sam and Toby to paint his barn one time only. Sam decides it would be easier to paint the top of the barn by climbing up a nearby tree and jumping onto the roof. Sam falls out of the tree and breaks his leg. Warren is liable for a. nothing, because Sam is an independent contractor. b. Sam's medical costs, because Sam is an agent. c. Sam's lost income and medical costs, because Sam is an employee. d. none of the above. ____ 39. Mick contracts with Brian to act as Mick's agent to direct smuggling operations into the United States. Brian does not successfully complete the smuggling operations. Mick can recover from Brian for a. nothing. b. breach of contract. c. malpractice. d. incompetence. ____ 40. Helen retains Jack to act as her authorized business agent. Helen does not know that Jack is a minor. Jack enters into a contract on Helen's behalf. The contract is a. binding on Helen. b. binding on Jack. c. void. d. voidable. ____ 41. Fred is legally incompetent. Fred can be a. an agent only. b. a principal only. c. an agent or a principal. d. none of the above. ____ 42. Bonnie and Dave may create their agency agreement a. orally. b. by written contract. c. by conduct. d. all of the above. ____ 43. Ellen, a salesperson at Top Tile Company, tells a customer, "Buy your tile here, and I'll install it myself for half of what Top would charge you." The customer makes the purchase based on Ellen's representation. Ellen installs the tile, charges the customer $500, and keeps the money. Ellen has breached the duty of a. loyalty. b. notification. c. obedience. d. none of the above. ____ 44. Donna holds herself out as possessing special engineering skills. As an agent, she must exercise the degree of skill or care expected of a. a person having those skills. b. a reasonable person. c. a reasonable person under similar circumstances. d. none of the above. ____ 45. Alex, an agent for Paul, signs an agreement on Paul's behalf but neglects to tell Paul that the agreement requires the payment of certain taxes. The government prosecutes Paul for failing to pay the taxes. Paul is a. not liable, because he was not informed of the tax liability by Alex. b. not liable, because he was not given adequate notice. c. liable, because Alex's knowledge is imputed to Paul. d. liable, because paying taxes is mandated by the Constitution. ____ 46. International Software, Inc., employs Jill as an agent. During the agency, Jill acquires new knowledge and skills. She also learns International's trade secrets, including customer lists. After the termination of the relationship, Jill uses her acquired skills and knowledge, but not International's trade secrets, in a new job. Jill has breached the duty of a. loyalty. b. obedience. c. performance. d. none of the above. ____ 47. Gil is agent an for Best Farm Products, Inc., in the Midwest. Gil owes Best Farm Products the duty of a. performance. b. c. d. notification. loyalty. all of the above. ____ 48. National Computer Corporation (NCC) employs Cynthia as an agent. NCC gives her an exclusive territory in which to sell NCC products. NCC cannot compete with her in that territory under the duty of a. compensation. b. cooperation. c. indemnification. d. reimbursement. ____ 49. Andy hires Bree to act as his agent. Clyde sues Andy for Bree's negligent conduct. Andy's right to sue Bree for an equal amount of damages is the right of a. nullification. b. avoidance. c. termination. d. indemnification. ____ 50. Paul employs Executive Personnel Agency as an agent. They sign a written agreement that describes the rights and duties of both parties. This is an example of a. apparent authority. b. express authority. c. implied authority. d. none of the above. ____ 51. Lynn may hire employees to work in the computer store she manages despite the fact that her employment agreement with the owner says nothing about her being able to hire employees. This is an example of a. apparent authority. b. equal authority. c. express authority. d. implied authority. ____ 52. U.S. Sales, Inc., employs Barb as a sales agent. U.S. Sales gives Barb a furnished office and an expense account. Techton Company orders goods from Barb, who fills the order with goods from Fast Products Corporation. The goods are defective. Techton may recover damages from U.S. Sales on the ground of a. b. c. d. apparent authority. express authority. implied authority. none of the above. ____ 53. Sue is an agent for Topical Productions, Inc. Topical may not rescind an unauthorized contract with United Catering Company executed by Sue if a. Sue caused United reasonably to believe that she was authorized to enter into the contract on Topical's behalf. b. Topical caused United reasonably to believe that Sue was authorized to enter into the contract on Topical's behalf. c. United assumed that Sue was authorized to enter into the contract on Topical's behalf. d. none of the above. ____ 54. Without authorization, Arnold contracts on behalf of Peter to have Brice paint the interior and exterior of Peter's house. Peter wishes to have Brice paint only the interior. Peter's attempt to rescind that part of the contract relating to the exterior and ratify that part of the contract relating to the interior will be a. successful. b. unsuccessful. c. illegal. d. none of the above. ____ 55. Greta hires David to act as her agent in the purchase of a home. Greta does not want the seller to know that she is the buyer, so she asks David to represent that he is making the purchase for himself. Greta is a. a disclosed principal. b. a partially disclosed principal. c. an undisclosed principal. d. an independent contractor. Fact Pattern 32-1 Al indicates that he is acting as an agent on behalf of an unidentified client when he enters into a contract with Stacey. ____ 56. Refer to Fact Pattern 32-1. The principal is a. disclosed. b. partially disclosed. c. undisclosed. d. none of the above. ____ 57. Refer to Fact Pattern 32-1. Who is liable to the third party for nonperformance of the contract? a. Al b. Al's principal c. Both a and b d. None of the above ____ 58. Brenda is a salesperson for Scot's Home Supply. She advises a customer that certain lumber will last for twenty years without treatment to prevent water damage. In reliance on this advice, the customer purchases the wood. Brenda's statement is in error, and the lumber deteriorates within three years. Scot's Home Supply is a. not liable-only Brenda is liable. b. not liable, nor is Brenda, because the customer should have known that the wood could not last for twenty years. c. liable, because the misrepresentation occurred within the scope of Brenda's employment. d. liable, with Brenda, under the rule of shared liability. ____ 59. Karen orders Tad, her real estate agent, to tell prospective buyers that there is a sparkling water spring beneath her land, even though she knows there is no spring. Tad tells prospective purchasers Larry and Helga about the spring. Helga buys the property. Karen is liable for any damages arising from her misrepresentation to a. Tad. b. Larry. c. Helga. d. none of the above. ____ 60. Jill is an employee of Kandy Shoppes, Inc. In deciding whether Jill was acting within the scope of her employment when she committed a tort against Loren, a court will not consider whether a. the act was one commonly performed by employees on behalf of their employers. b. Jill made statements indicating that she was acting on behalf of Kandy Shoppes. c. Kandy Shoppes authorized the act. d. Kandy Shoppes furnished the means or instrumentality by which the injury was inflicted. ____ 61. Tri-State Trucking Company employs Warren as a delivery agent. While making a delivery within the scope of employment, Warren causes an accident in which Yvonne is injured. Yvonne can recover from a. Tri-State Trucking only. b. Warren only. c. Tri-State Trucking or Warren. d. none of the above. ____ 62. Electronics Warehouse Company employs Statewide Financial, Inc., as a collection agent. While repossessing goods from Todd, one of Electronics's delinquent customers, Statewide causes an accident in which Todd is injured. Todd can recover from a. Electronics Warehouse only. b. Statewide Financial only. c. Electronics Warehouse or Statewide Financial. d. none of the above. ____ 63. Tina is a sales agent for American Sales, Inc. They may terminate their agency relationship by a. mutual agreement. b. the occurrence of a specific event. c. the achievement of the purpose of the agreement. d. any of the above. ____ 64. Gil is a purchasing agent for H&H Ranch with the authority to buy cattle at a certain auction. After the cattle have been bought, the agency relationship terminates a. automatically. b. following notice to all actual cattle sellers. c. following notice to all potential cattle sellers. d. following published notice in a local newspaper. ____ 65. Eagle Manufacturing Company employs Linda as an agent. To terminate Linda's authority, Eagle must notify a. Linda only. b. only third parties who know of the agency relationship. c. Linda and third parties who know of the agency relationship. d. none of the above. ____ 66. Mike hires Candy, a real estate broker, to sell his house. The house burns down before being sold. The existing agency agreement is likely a. still in force if Candy says nothing about the fire to prospective customers. b. still in force if Mike gives Candy additional consideration. c. terminated by operation of law. d. terminated by mutual consent of the parties. MULTIPLE CHOICE 33. Register to View AnswerREF: 572 OBJ: Type: N 34. Register to View AnswerREF: 573 OBJ: Type: N 35. Register to View AnswerREF: 573 OBJ: Type: = 36. Register to View AnswerREF: 573 OBJ: Type: = 37. Register to View AnswerREF: 573 OBJ: Type: N 38. Register to View AnswerREF: 573 OBJ: Type: = 39. Register to View AnswerREF: 577 OBJ: Type: = 40. Register to View AnswerREF: 577 OBJ: Type: N 41. Register to View AnswerREF: 577 OBJ: Type: N 42. Register to View AnswerREF: 577 OBJ: Type: = 43. Register to View AnswerREF: 580 OBJ: Type: + 44. Register to View AnswerREF: 580 OBJ: Type: + 45. Register to View AnswerREF: 580 OBJ: Type: = 46. Register to View AnswerREF: 580 OBJ: Type: N 47. Register to View AnswerREF: 580 OBJ: Type: = 48. Register to View AnswerREF: 582 OBJ: Type: N 49. Register to View AnswerREF: 583 OBJ: Type: N 50. Register to View AnswerREF: 587 OBJ: Type: N 51. Register to View AnswerREF: 588 OBJ: Type: + 52. Register to View AnswerREF: 589 OBJ: Type: N 53. Register to View AnswerREF: 589 OBJ: Type: + 54. 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Philosophy Notes 11-13-09Page 1Existentialism:Existence:Traditional Meaning- what is real, actual, vs. unreal, potential, fictionalHuman existence: my life as I experience it is the starting point for philosophy.> subjectivity not equal to objectivi