Petropolis Co Is a Manufacturer of Auto Parts and Is

Multiple Choice

Petropolis Co is a manufacturer of auto parts and is looking for distributors in New Brunswick.They already have distributors in the other provinces.Jacob is negotiating to become the distributor for New Brunswick.Unlike the distributors in the other provinces,Jacob does not want to take responsibility for buying the parts and then reselling them.Instead,he wants to sell the parts as an agent for Petropolis.Which of the following factors would be relevant to Petropolis in deciding how to respond to Jacob's proposal?

A) Distributors can never be agents.
B) Petropolis will be concerned about the potential for Jacob to bind Petropolis to unauthorized obligations.
C) An agency does not require a written agreement.
D) Distributors must provide warranty service.
E) Distributors have better incentives than agents to work hard.