Question 1

Which of the following typically exists when an employer hires an employee to enter into contracts on behalf of the employer?

Accepted Answer

A)  Principal-agent relationship 
B)  Employer-agent relationship 
C)  Employer-independent contractor relationship 
D)  Avowed relationship 
E)  Acknowledged relationship 
A)  Principal-agent relationship 
B)  Employer-agent relationship 
C)  Employer-independent contractor relationship 
D)  Avowed relationship 
E)  Acknowledged relationship

Question 2

When a contract exists and a principal agrees to certain conditions, but fails to perform, which of the following may the agent seek in order to force the principal to perform the contract as stipulated?

Accepted Answer

A)  Specific performance 
B)  Specific recoupment 
C)  Adequate performance 
D)  Reformation 
E)  None of these 
A)  Specific performance 
B)  Specific recoupment 
C)  Adequate performance 
D)  Reformation 
E)  None of these

Question 3

Which of the following was the result on appeal in Iglesia Cristiana La Casa Del Senor, Inc., Etc. v. L.M., the case in the text involving the issue of whether a church was liable based on the principle of respondeat superior for a sexual assault allegedly committed by a church pastor?

Accepted Answer

A)  That the church was liable to the plaintiff based upon principles of respondeat superior. 
B)  That the church was liable based on principles of respondeat superior only if it could be proven that the pastor sexually assaulted more than one person. 
C)  That the church was liable based on respondeat superior only if it could be proven that the church had knowledge of at least one sexual assault prior to the plaintiff's but failed to remove the pastor from church assignments. 
D)  That the church was not liable based upon principles of respondeat superior. 
E)  That the church was not liable based upon principles of respondeat superior only because the pastor was immediately fired when his actions came to light. 
A)  That the church was liable to the plaintiff based upon principles of respondeat superior. 
B)  That the church was liable based on principles of respondeat superior only if it could be proven that the pastor sexually assaulted more than one person. 
C)  That the church was liable based on respondeat superior only if it could be proven that the church had knowledge of at least one sexual assault prior to the plaintiff's but failed to remove the pastor from church assignments. 
D)  That the church was not liable based upon principles of respondeat superior. 
E)  That the church was not liable based upon principles of respondeat superior only because the pastor was immediately fired when his actions came to light.

Question 4

What does the Latin phrase respondeat superior mean?

Accepted Answer

A)  Let the superior speak 
B)  Let the agent speak 
C)  Let the employee speak 
D)  Let all speak 
E)  Let all be responsible 
A)  Let the superior speak 
B)  Let the agent speak 
C)  Let the employee speak 
D)  Let all speak 
E)  Let all be responsible

Question 5

Which of the following is a person who has a duty to act primarily for another person's benefit?

Accepted Answer

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

Question 6

The doctrine of ______________ is used in the context of the principal/employer-agent/employee relationship.

Accepted Answer

A)  Superior respondeat 
B)  Respondeat superior 
C)  Stare decisis 
D)  Res superior 
E)  Supre superior 
A)  Superior respondeat 
B)  Respondeat superior 
C)  Stare decisis 
D)  Res superior 
E)  Supre superior

Question 7

The question of whether a worker is an employee or an independent contractor has important implications in which of the following areas?

Accepted Answer

A)  Workers' compensation 
B)  Workplace safety 
C)  Unemployment statutes 
D)  Workers' compensation, workplace safety, and unemployment statutes 
E)  Workers' compensation and workplace safety, but not unemployment statutes 
A)  Workers' compensation 
B)  Workplace safety 
C)  Unemployment statutes 
D)  Workers' compensation, workplace safety, and unemployment statutes 
E)  Workers' compensation and workplace safety, but not unemployment statutes

Question 8

A durable power of attorney is legally binding after the principal becomes incapacitated.

Accepted Answer

A) True 
 B)False

Question 9

If an agent breaches duties owed to the principal, the principal can sue the agent; and the principal may be entitled to a variety of contract and tort remedies beyond those stated in the contract between the principal and agent.

Accepted Answer

A) True 
 B)False

Question 10

Which of the following is generally defined as a relationship between a principal and an agent?

Accepted Answer

A)  Agency 
B)  Principality 
C)  Combination 
D)  Employment 
E)  Authorization 
A)  Agency 
B)  Principality 
C)  Combination 
D)  Employment 
E)  Authorization

Question 11

Which of the following is the most common form of agency?

Accepted Answer

A)  Expressed agency 
B)  Implied agency 
C)  Apparent agency 
D)  Ratification 
E)  Endorsement 
A)  Expressed agency 
B)  Implied agency 
C)  Apparent agency 
D)  Ratification 
E)  Endorsement

Question 12

If a principal agrees to hire no other agent for a period of time or until a particular job is done, the principal and agent have entered into a[n] ______________ agency contract.

Accepted Answer

A)  Limited 
B)  Specific 
C)  Exact 
D)  Identified 
E)  Exclusive 
A)  Limited 
B)  Specific 
C)  Exact 
D)  Identified 
E)  Exclusive

Question 13

Which of the following is the term for the rule enforced by most states that when express authority is granted for an agent to enter into a contract legally required to be in writing, the grant of authority also must be in writing?

Accepted Answer

A)  The equal dignity rule 
B)  The required writing rule 
C)  The statute of frauds rule 
D)  The matching rule 
E)  None of these because there is no such rule 
A)  The equal dignity rule 
B)  The required writing rule 
C)  The statute of frauds rule 
D)  The matching rule 
E)  None of these because there is no such rule

Question 14

Bankruptcy of either the principal or agent always terminates the agency relationship.

Accepted Answer

A) True 
 B)False

Question 15

In order to properly provide notice of the termination of an agency relationship, actual notice of agency termination must be given to third parties who have had business interactions with the agent.

Accepted Answer

A) True 
 B)False

Question 16

Which of the following is the term used to describe the duty an agent has to follow the lawful instruction and direction of the principal?

Accepted Answer

A)  Duty of action 
B)  Duty of contract 
C)  Express duty of action 
D)  Duty of performance 
E)  Duty of obedience 
A)  Duty of action 
B)  Duty of contract 
C)  Express duty of action 
D)  Duty of performance 
E)  Duty of obedience

Question 17

Which of the following is true regarding liability of an agent acting within his or her authority on a contract involving an undisclosed principal?

Accepted Answer

A)  The law will likely hold the agent liable for the agreement. 
B)  The law will hold the agent liable for the agreement unless the contract the agent had with the principal expressly provided that the agent would not be held liable in such cases. 
C)  The law will hold the agent liable for the agreement unless the contract the agent had with the principal impliedly or expressly provided that the agent would not be held liable in such cases. 
D)  The law will hold the agent liable for the agreement unless a contract for under $1,000 is involved in which case only the principal would be held liable. 
E)  The law would not hold the agent liable on the agreement. 
A)  The law will likely hold the agent liable for the agreement. 
B)  The law will hold the agent liable for the agreement unless the contract the agent had with the principal expressly provided that the agent would not be held liable in such cases. 
C)  The law will hold the agent liable for the agreement unless the contract the agent had with the principal impliedly or expressly provided that the agent would not be held liable in such cases. 
D)  The law will hold the agent liable for the agreement unless a contract for under $1,000 is involved in which case only the principal would be held liable. 
E)  The law would not hold the agent liable on the agreement.

Question 18

Under which of the following does a principal give authority to an agent only for the specific areas or purposes listed in the agency agreement?

Accepted Answer

A)  A general power of attorney 
B)  A specific power of attorney 
C)  A localized power of attorney 
D)  A broad power of attorney 
E)  A recognized power or attorney 
A)  A general power of attorney 
B)  A specific power of attorney 
C)  A localized power of attorney 
D)  A broad power of attorney 
E)  A recognized power or attorney

Question 19

Which of the following is false regarding a principal's duties to an agent?

Accepted Answer

A)  An agent can sue the principal if the principal does not fulfill duties owed to the agent. 
B)  In a successful suit against a principal, an agent is entitled to contract remedies but not tort remedies. 
C)  If the principal has failed to meet duties owed to the agent, the agent can refuse to act on behalf of the principal until the failure is remedied. 
D)  The principal has a duty to compensate an agent for services provided unless the parties have agreed that the agent will act gratuitously. 
E)  The principal has a duty of reimbursement and indemnification to the agent for authorized expenditures. 
A)  An agent can sue the principal if the principal does not fulfill duties owed to the agent. 
B)  In a successful suit against a principal, an agent is entitled to contract remedies but not tort remedies. 
C)  If the principal has failed to meet duties owed to the agent, the agent can refuse to act on behalf of the principal until the failure is remedied. 
D)  The principal has a duty to compensate an agent for services provided unless the parties have agreed that the agent will act gratuitously. 
E)  The principal has a duty of reimbursement and indemnification to the agent for authorized expenditures.

Question 20

Which of the following types of agency occurs when a principal leads a third party to believe another individual serves as his or her agent; but, the principal has actually made no agreement with the so-called agent?

Accepted Answer

A)  Expressed agency 
B)  Implied agency 
C)  Apparent agency 
D)  Ratification 
E)  Endorsement 
A)  Expressed agency 
B)  Implied agency 
C)  Apparent agency 
D)  Ratification 
E)  Endorsement

Exam 19: Secured Transactions and Bankruptcy

Which of the following typically exists when an employer hires an employee to enter into contracts on behalf of the employer?

When a contract exists and a principal agrees to certain conditions, but fails to perform, which of the following may the agent seek in order to force the principal to perform the contract as stipulated?

Which of the following was the result on appeal in Iglesia Cristiana La Casa Del Senor, Inc., Etc. v. L.M., the case in the text involving the issue of whether a church was liable based on the principle of respondeat superior for a sexual assault allegedly committed by a church pastor?

What does the Latin phrase respondeat superior mean?

Which of the following is a person who has a duty to act primarily for another person's benefit?

The doctrine of ______________ is used in the context of the principal/employer-agent/employee relationship.

The question of whether a worker is an employee or an independent contractor has important implications in which of the following areas?

A durable power of attorney is legally binding after the principal becomes incapacitated.

If an agent breaches duties owed to the principal, the principal can sue the agent; and the principal may be entitled to a variety of contract and tort remedies beyond those stated in the contract between the principal and agent.

Which of the following is generally defined as a relationship between a principal and an agent?

Which of the following is the most common form of agency?

If a principal agrees to hire no other agent for a period of time or until a particular job is done, the principal and agent have entered into a[n] ______________ agency contract.

Which of the following is the term for the rule enforced by most states that when express authority is granted for an agent to enter into a contract legally required to be in writing, the grant of authority also must be in writing?

Bankruptcy of either the principal or agent always terminates the agency relationship.

In order to properly provide notice of the termination of an agency relationship, actual notice of agency termination must be given to third parties who have had business interactions with the agent.

Which of the following is the term used to describe the duty an agent has to follow the lawful instruction and direction of the principal?

Which of the following is true regarding liability of an agent acting within his or her authority on a contract involving an undisclosed principal?

Under which of the following does a principal give authority to an agent only for the specific areas or purposes listed in the agency agreement?

Which of the following is false regarding a principal's duties to an agent?

Which of the following types of agency occurs when a principal leads a third party to believe another individual serves as his or her agent; but, the principal has actually made no agreement with the so-called agent?

An Introduction to the Fundamentals of Dynamic Business Law

Business Ethics and Social Responsibility

The Us Legal System and Alternative Dispute Resolution

Administrative Law

Constitutional Law

Criminal Law and Business

Tort Law

Real, Personal, and Intellectual Property

Introduction to Contracts and Agreement

Consideration

Capacity and Legality

Reality of Assent

Contracts in Writing and Third-Party Contracts

Discharge and Remedies

Formation and Performance of Sales and Lease Contracts

Sales and Lease Contracts: Performance, Warranties, and Remedies

Negotiable Instruments: Negotiability and Transferability

Holder in Due Course, Liability, and Defenses

Agency and Liability to Third Parties

Forms of Business Organization

Corporations: Formation and Organization

Securities Regulation

Employment and Discrimination Law

Consumer Law

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