Question 1

Not only must a principal agree to have a person act as an agent,but the agent must also agree to act for the principal.

Accepted Answer

A) True 
 B)False  True

Question 2

In the text case Glenn v.Gibbs,Glenn was injured and eventually died from his injuries as a direct result of trimming Gibbs' tree limbs.Glenn's wife sued Gibbs for negligence alleging Gibbs' actions and omissions caused Glenn's death.Which of the following was the result?

Accepted Answer

A) Gibbs was liable because Glenn was an employee. 
B) Gibbs was liable because Glenn was an independent contractor. 
C) Gibbs settled the lawsuit out of court and admitted fault. 
D) Gibbs was not liable because Glenn was an independent contractor. 
E) Gibbs was not liable because Glenn was an employee. 
A) Gibbs was liable because Glenn was an employee. 
B) Gibbs was liable because Glenn was an independent contractor. 
C) Gibbs settled the lawsuit out of court and admitted fault. 
D) Gibbs was not liable because Glenn was an independent contractor. 
E) Gibbs was not liable because Glenn was an employee. D

Question 3

Meryl is an avid doll collector and has been searching for the Beach Doll to complete her 200- piece collection.There were only 5 Beach Dolls created in the world.Meryl is envious of her neighbor Nancy,who has the first Beach Doll ever created.Nancy refuses to sell the doll because she thinks it will be worth a million dollars someday.While Nancy is on vacation,Meryl hires Alex to steal the doll from Nancy's home.Has an agency relationship been formed?

Accepted Answer

A) No,because the agreement has an illegal purpose. 
B) No,because the agreement must be in writing. 
C) No,because the amount or form of compensation was not contemplated. 
D) Yes,because the agreement may be oral or in writing. 
E) Yes,because Alex's objective was unambiguous. 
A) No,because the agreement has an illegal purpose. 
B) No,because the agreement must be in writing. 
C) No,because the amount or form of compensation was not contemplated. 
D) Yes,because the agreement may be oral or in writing. 
E) Yes,because Alex's objective was unambiguous. A

Question 4

If there is no agreement between a principal and an agent regarding the amount for which the principal will compensate the agent,which of the following statements is true?

Accepted Answer

A) The agent will be allowed to set the price which will be enforced unless it is unconscionable. 
B) The court will appoint a magistrate to set the price. 
C) The principal will be allowed to set the price which will be enforced unless it is unconscionable. 
D) Compensation will be calculated according to the customary fee in the situation. 
E) It will be assumed that the agent agreed to work for free on a gratuitous basis. 
A) The agent will be allowed to set the price which will be enforced unless it is unconscionable. 
B) The court will appoint a magistrate to set the price. 
C) The principal will be allowed to set the price which will be enforced unless it is unconscionable. 
D) Compensation will be calculated according to the customary fee in the situation. 
E) It will be assumed that the agent agreed to work for free on a gratuitous basis.

Question 5

When an individual misrepresents himself or herself as another party's agent and the principal accepts the unauthorized act,which of the following has occurred?

Accepted Answer

A) Agency by implied authority 
B) Agency by agreement 
C) Agency by ratification 
D) An expressed agency 
E) Apparent agency 
A) Agency by implied authority 
B) Agency by agreement 
C) Agency by ratification 
D) An expressed agency 
E) Apparent agency

Question 6

The Case Opener discussed whether FedEx illegally refused to collectively bargain with single-route drivers on the basis that they were independent contractors,not employees.Which of the following is true regarding the result?

Accepted Answer

A) The court found that at times the drivers acted as employees and that other times they acted as independent contractors and that they would,therefore,be classified as independent contractors. 
B) The court found that at times the drivers acted as employees and that other times they acted as independent contractors and that they would,therefore,be classified as employees. 
C) The court found that all the rights and duties of employees as agents applied to their relationship with FedEx. 
D) The court found that FedEx did not exercise the degree of control necessary for the relationship to be considered employer-employee. 
E) To determine whether the FedEx drivers should be classified as employees or independent contractors,the court applied federal statutory law. 
A) The court found that at times the drivers acted as employees and that other times they acted as independent contractors and that they would,therefore,be classified as independent contractors. 
B) The court found that at times the drivers acted as employees and that other times they acted as independent contractors and that they would,therefore,be classified as employees. 
C) The court found that all the rights and duties of employees as agents applied to their relationship with FedEx. 
D) The court found that FedEx did not exercise the degree of control necessary for the relationship to be considered employer-employee. 
E) To determine whether the FedEx drivers should be classified as employees or independent contractors,the court applied federal statutory law.

Question 7

Which of the following is true regarding agency contracts?

Accepted Answer

A) Agency contracts must clearly define the agent's compensation. 
B) A contract is not required to create an agency but if a contract exists,it must meet all requirements prescribed by contract law. 
C) A contract is required to create a valid agency 
D) An agency contract only needs to be signed by the principal. 
E) An agency contract cannot create an agency agreement longer than two years. 
A) Agency contracts must clearly define the agent's compensation. 
B) A contract is not required to create an agency but if a contract exists,it must meet all requirements prescribed by contract law. 
C) A contract is required to create a valid agency 
D) An agency contract only needs to be signed by the principal. 
E) An agency contract cannot create an agency agreement longer than two years.

Question 8

Which of the following is not one of the criteria listed in the text as indicative of whether a worker is an employee or an independent contractor?

Accepted Answer

A) The amount of time the worker has been involved in the trade or area at issue. 
B) Whether the worker is engaged in a distinct occupation or an independently established business. 
C) Whether the employer supplying the tools. 
D) How the worker is paid. 
E) The length of time for which the worker is employed. 
A) The amount of time the worker has been involved in the trade or area at issue. 
B) Whether the worker is engaged in a distinct occupation or an independently established business. 
C) Whether the employer supplying the tools. 
D) How the worker is paid. 
E) The length of time for which the worker is employed.

Question 9

Did Paolo have any legal liability to AAA Computers?

Accepted Answer

A) Yes,because he made the purchase from AAA Computers without mention of Joe. 
B) Yes,but only if Joe refused to pay. 
C) Yes,but only because office equipment is involved. 
D) Yes,but only if Joe were declared judicially insolvent. 
E) No,because his status was as an agent regardless of whether AAA Computers was aware of that fact. 
A) Yes,because he made the purchase from AAA Computers without mention of Joe. 
B) Yes,but only if Joe refused to pay. 
C) Yes,but only because office equipment is involved. 
D) Yes,but only if Joe were declared judicially insolvent. 
E) No,because his status was as an agent regardless of whether AAA Computers was aware of that fact.

Question 10

An agency relationship exists when an agent is authorized to act for and on behalf of the principal,who hires an agent to represent him or her.

Accepted Answer

A) True 
 B)False

Question 11

Which of the following is a term used to describe the duty of an agent to communicate any information to the principal that the agent thinks could be important to the principal?

Accepted Answer

A) Constructive information 
B) Duty of information 
C) Requirement of conveyance 
D) Duty of notification 
E) Constructive notification 
A) Constructive information 
B) Duty of information 
C) Requirement of conveyance 
D) Duty of notification 
E) Constructive notification

Question 12

In Ralph T.Leonard v.Jerry D.McMorris,the text case that discussed whether,under the Colorado Wage Claim Act,company executives of a bankrupt company were liable to employees for unpaid wages and benefits,which of the following was the result?

Accepted Answer

A) If a company is bankrupt,its executives are liable for wages,but not for benefits. 
B) If a company is bankrupt,its executives are liable for wages and benefits in an amount up to $5,000 per employee. 
C) Company executives are not individually liable for unpaid wages or benefits. 
D) If a company is bankrupt,its executives are liable for wages and benefits in an amount up to $50,000 per executive to be allocated equally among employees. 
E) If a company is bankrupt,its executives are liable for benefits,but not for wages. 
A) If a company is bankrupt,its executives are liable for wages,but not for benefits. 
B) If a company is bankrupt,its executives are liable for wages and benefits in an amount up to $5,000 per employee. 
C) Company executives are not individually liable for unpaid wages or benefits. 
D) If a company is bankrupt,its executives are liable for wages and benefits in an amount up to $50,000 per executive to be allocated equally among employees. 
E) If a company is bankrupt,its executives are liable for benefits,but not for wages.

Question 13

A[n] ________ trust is an equitable trust imposed on one who wrongfully obtains or holds legal right to property he or she should not possess.

Accepted Answer

A) Actual 
B) Resolute 
C) Absolute 
D) Defined 
E) Constructive 
A) Actual 
B) Resolute 
C) Absolute 
D) Defined 
E) Constructive

Question 14

As set forth in the text,which of the following is false regarding agency law in relation to sports agents?

Accepted Answer

A) Efforts are underway to develop a uniform act addressing regulation of sports agents because none exists at the present time. 
B) The Major League Baseball Players Association's Regulations Governing Player Agents expressly state that agents act in a fiduciary capacity vis-à-vis their athlete clients. 
C) Players associations' model contracts describe the nature of the services agents can perform on behalf of their principals and the duties the parties owe to one another. 
D) Some states have established criminal penalties for athletes who violate the state law addressing regulation of sports agents,but most states focus on criminalizing the activity of sports agents. 
E) Over half of the states have enacted statutes governing the behavior of sports agents. 
A) Efforts are underway to develop a uniform act addressing regulation of sports agents because none exists at the present time. 
B) The Major League Baseball Players Association's Regulations Governing Player Agents expressly state that agents act in a fiduciary capacity vis-à-vis their athlete clients. 
C) Players associations' model contracts describe the nature of the services agents can perform on behalf of their principals and the duties the parties owe to one another. 
D) Some states have established criminal penalties for athletes who violate the state law addressing regulation of sports agents,but most states focus on criminalizing the activity of sports agents. 
E) Over half of the states have enacted statutes governing the behavior of sports agents.

Question 15

[Overstock] Mark owns an electronic resale store.Before Mark left for the weekend,he told Charlie,an employee,not to purchase any more compact discs CDs)from customers because they were already having a difficult time selling the ones they had in stock.While Mark is gone,Charlie forgets Mark's instructions and buys nine CDs from customers.
-Which of the following statements is true regarding Charlie's liability to Mark?

Accepted Answer

A) Mark may recover the cost of the nine CDs because Charlie did not follow his instructions. 
B) Charlie is not liable to Mark because he believed Mark would have bought the CDs from the customer. 
C) Charlie is not liable to Mark because he thought the purchase price of the CDs were exceptionally great. 
D) Charlie is not liable to Mark because he did not remember Mark's instructions. 
E) Charlie is not liable to Mark because he is his employee. 
A) Mark may recover the cost of the nine CDs because Charlie did not follow his instructions. 
B) Charlie is not liable to Mark because he believed Mark would have bought the CDs from the customer. 
C) Charlie is not liable to Mark because he thought the purchase price of the CDs were exceptionally great. 
D) Charlie is not liable to Mark because he did not remember Mark's instructions. 
E) Charlie is not liable to Mark because he is his employee.

Question 16

An agent may use the agency relationship to obtain property for himself or herself when the principal desired to obtain the same property.

Accepted Answer

A) True 
 B)False

Question 17

The law assumes that the principal is aware only of information actually provided to the principal by the agent.

Accepted Answer

A) True 
 B)False

Question 18

A person who has a duty to act primarily for another person's benefit is called a[n] ________.

Accepted Answer

A) Employer 
B) Principal 
C) Benefitor 
D) Fiduciary 
E) Trustor 
A) Employer 
B) Principal 
C) Benefitor 
D) Fiduciary 
E) Trustor

Question 19

Agency law is primarily federal law.

Accepted Answer

A) True 
 B)False

Question 20

Which of the following is false regarding implied agency and apparent agency?

Accepted Answer

A) Circumstances may determine the extent of implied agency. 
B) Implied agency may conflict with express authority. 
C) An implied agency as well as an apparent agency may be created by conduct. 
D) Apparent agency is also known as agency by estoppel. 
E) If a principal in an alleged apparent agency situation denies that an agency existed,the third party alleging agency must demonstrate that he or she reasonably believed,based on the principal's conduct,that an agency relationship existed. 
A) Circumstances may determine the extent of implied agency. 
B) Implied agency may conflict with express authority. 
C) An implied agency as well as an apparent agency may be created by conduct. 
D) Apparent agency is also known as agency by estoppel. 
E) If a principal in an alleged apparent agency situation denies that an agency existed,the third party alleging agency must demonstrate that he or she reasonably believed,based on the principal's conduct,that an agency relationship existed.

Exam 33: Agency Formation and Duties

Not only must a principal agree to have a person act as an agent,but the agent must also agree to act for the principal.

In the text case Glenn v.Gibbs,Glenn was injured and eventually died from his injuries as a direct result of trimming Gibbs' tree limbs.Glenn's wife sued Gibbs for negligence alleging Gibbs' actions and omissions caused Glenn's death.Which of the following was the result?

If there is no agreement between a principal and an agent regarding the amount for which the principal will compensate the agent,which of the following statements is true?

When an individual misrepresents himself or herself as another party's agent and the principal accepts the unauthorized act,which of the following has occurred?

The Case Opener discussed whether FedEx illegally refused to collectively bargain with single-route drivers on the basis that they were independent contractors,not employees.Which of the following is true regarding the result?

Which of the following is true regarding agency contracts?

Which of the following is not one of the criteria listed in the text as indicative of whether a worker is an employee or an independent contractor?

Did Paolo have any legal liability to AAA Computers?

An agency relationship exists when an agent is authorized to act for and on behalf of the principal,who hires an agent to represent him or her.

Which of the following is a term used to describe the duty of an agent to communicate any information to the principal that the agent thinks could be important to the principal?

In Ralph T.Leonard v.Jerry D.McMorris,the text case that discussed whether,under the Colorado Wage Claim Act,company executives of a bankrupt company were liable to employees for unpaid wages and benefits,which of the following was the result?

A[n] ________ trust is an equitable trust imposed on one who wrongfully obtains or holds legal right to property he or she should not possess.

As set forth in the text,which of the following is false regarding agency law in relation to sports agents?

An agent may use the agency relationship to obtain property for himself or herself when the principal desired to obtain the same property.

The law assumes that the principal is aware only of information actually provided to the principal by the agent.

A person who has a duty to act primarily for another person's benefit is called a[n] ________.

Agency law is primarily federal law.

Which of the following is false regarding implied agency and apparent agency?

An Introduction to Dynamic Business Law

Business Ethics

The Uslegal System

Alternative Dispute Resolution

Constitutional Principles

International and Comparative Law

Crime and the Business Community

Tort Law

Negligence and Strict Liability

Product Liability

Liability of Accountants and Other Professionals

Intellectual Property

Introduction to Contracts

Agreement

Consideration

Capacity and Legality

Legal Assent

Contracts in Writing

Third-Party Rights to Contracts

Discharge and Remedies

Introduction to Sales and Lease Contracts

Title,risk of Loss,and Insurable Interest

Performance and Obligations Under Sales and Leases

Remedies for Breach of Sales and Lease Contracts

Warranties

Negotiable Instruments: Negotiability and Transferability

Negotiation, holder in Due Course, and Defenses

Liability, defenses, and Discharge

Checks and Electronic Fund Transfers

Secured Transactions

Other Creditors Remedies and Suretyship

Bankruptcy and Reorganization

Liability to Third Parties and Termination

Forms of Business Organization

Partnerships: Nature, formation, and Operation

Partnerships: Termination and Limited Partnerships

Corporations: Formation and Financing

Corporations: Directors, officers, and Shareholders

Corporations: Mergers, consolidations, terminations

Corporations: Securities and Investor Protection

Employment and Labor Law

Employment Discrimination

Administrative Law

Consumer Law

Environmental Law

Antitrust Law

The Nature of Property, personal Property, and Bailments

Real Property

Landlord-Tenant Law

Insurance Law

Wills and Trusts

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