Ch32-TB2-WBL-10e

Ch32-TB2-WBL-10e - Chapter32 LiabilitytoThirdParties...

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Chapter 32 Liability to Third Parties  and Termination N.B.:   TYPE  indicates that a question is new, modified, or unchanged, as  follows. N A question  new  to this edition of the Test Bank. + A question  modified  from the previous edition of the Test Bank, = A question  included  in the previous edition of the Test Bank. TRUE/FALSE QUESTIONS 1. If a contract must be in writing under the Statute of Frauds, the agent’s  authority to perform the same duty must be in writing. ANSWER: T PAGE: 651 TYPE: N 2. An agent’s authority must be express for the agent’s act to bind a principal. ANSWER: F PAGE: 651 TYPE: + 3. An agent’s authority to act on behalf of a principal derives exclusively from  the agent’s implied authority. ANSWER: F PAGE: 651 TYPE: + 4. The equal dignity rule does not apply to a corporate officer who, in an or- dinary business situation, acts on behalf of his or her firm. ANSWER: T PAGE: 651 TYPE: = 69
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70 TEST BANK 2—UNIT SEVEN: AGENCY AND EMPLOYMENT 5. A power of attorney may be created orally. ANSWER: F PAGE: 651 TYPE: N
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CHAPTER 32: LIABILITY TO THIRD PARTIES AND TERMINATION 71 6. A power of attorney can be given only  to  an actual attorney. ANSWER: F PAGE: 651 TYPE: = 7. An agent’s implied authority may be conferred by custom. ANSWER: T PAGE: 652 TYPE: = 8. If a principal does not ratify an   authorized   contract, the principal is not  bound. ANSWER: F PAGE: 654 TYPE: N 9. A principal can ratify a contract signed by his or her purported agent either  expressly or by implication. ANSWER: T PAGE: 654 TYPE: = 10. A principal’s liability in a contract with a third party may arise from the  authority given to the agent to enter into the contract. ANSWER: T PAGE: 654 TYPE: + 11. If an agent acts within the scope of his or her authority, a  disclosed  prin- cipal is liable to a third party for contracts made by the agent. ANSWER: T PAGE: 654 TYPE: = 12. If an agent acts within the scope of his or her authority, a   partially dis- closed  principal is liable to a third party for contracts made by the agent. ANSWER: T PAGE: 654 TYPE: = 13. partially disclosed  principal is liable to a third party for contracts made  by the agent acting outside the scope of his or her authority. ANSWER: F PAGE: 654 TYPE: = 14. An   undisclosed   principal   is   one   whose   existence   is   known,   but   whose  specific identity is not known, by a third party with whom a contract is  made.
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TEST BANK 2—UNIT SEVEN: AGENCY AND EMPLOYMENT ANSWER: F PAGE: 656 TYPE: N 15. Any party who uses an e-agent is bound by the e-agent’s actions.
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This note was uploaded on 10/15/2010 for the course ACCT ACCT40 taught by Professor Birnbaum during the Fall '08 term at CUNY Brooklyn.

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Ch32-TB2-WBL-10e - Chapter32 LiabilitytoThirdParties...

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