If an Agent Exceeds His or Her Scope of Authority

question 17

True/False

If an agent exceeds his or her scope of authority, a principal is bound on the contract only if he or she ratifies the contract.

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Definitions:

Price

The financial value forecasted, demanded, or handed over as compensation for an item.

Quantity

The amount or number of a material or immaterial good that is considered as a unit or an aggregate.

Price Ceiling

A legal maximum price set by government on certain goods or services, intended to prevent prices from becoming too high.

Deadweight Loss

The loss of economic efficiency that occurs when the equilibrium for a good or a service is not achieved, leading to a misallocation of resources.