An Agent Who Does Something That They Were Not in Fact

question 71

Multiple Choice

An agent who does something that they were not in fact authorised to do, but had apparent authority to do, will:

• A)have breached the duty to follow the principal's instructions.
• B)not be liable to the principal.
• C)be liable to criminal prosecution.
• D)be liable to the principal and to the third party, if either has suffered damage.

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Definitions:

Positive Net Present Value

Indicates that the present value of future cash flows from an investment exceeds the initial investment cost, suggesting profitability.

Debt-Equity Ratio

A measure of a company's financial leverage, calculated by dividing its total liabilities by its shareholder equity.

Stock Repurchase

A company's buying back of its own shares from the marketplace, reducing the number of outstanding shares and often increasing shareholder value.

Excess Cash

Cash holdings that exceed the normal operational needs of a company, potentially available for investment or distribution to shareholders.