If a Third Party Relies on the Principal's Representation That

question 126

Multiple Choice

If a third party relies on the principal's representation that the agent has the authority to act, which of the following is true?

• A) The principal can claim the agent had no authority.
• B) The agent is solely liable for the conduct if it results in injury to the third party.
• C) The principal can claim estoppel.
• D) The principal cannot claim the agent had no authority.
• E) The agent can sue the principal for breach of contract.

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Definitions:

Compounded Annually

The process of calculating interest on both the initial principal and the accumulated interest from previous periods once a year.

Retirement

The point in time when an individual chooses to leave the workforce permanently, often accompanied by receiving pension or retirement savings.

Annual Rate of Return

This is the percentage change in the value of an investment over a one-year period, taking into account both capital gains and income received.

Investment

The allocation of resources, usually financial, in expectation of a future return, which may include interest earnings, dividends, or appreciation in value.