When an Agent Negotiates a Contract on Behalf of the Principal,the

question 31

Multiple Choice

When an agent negotiates a contract on behalf of the principal,the liability of the principal will depend on if:

• A) the agent was motivated by the principal's best interests
• B) the agency arrangement was fully disclosed
• C) the agency arrangement was express or implied
• D) the agent was authorized to enter into this particular transaction
• E) the agency arrangement was agreed to in writing

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Definitions:

Risk

The potential for losing something of value or the possibility of an adverse outcome, often quantified in terms of probability and impact.

Objectivity

The practice of basing decisions or conclusions on unbiased facts and evidence rather than personal feelings or opinions.

Strategic Planning

The process of defining an organization's direction and making decisions on allocating its resources to pursue this strategy.

Boundary Spanning

Activities undertaken by individuals or organizations to interact with and influence external stakeholders and environments.