Which of the Following Statements Is True

question 16

Multiple Choice

Which of the following statements is true?

• A)Power is a type of authority.
• B)Authority and power are identical.
• C)Authority is a type of power.
• D)Power is determined by horizontal position in an organization.

Grasp the concepts of salvage value, cash inflows, and depreciation in the context of capital budgeting.

Appreciate the impact of tax rates on investment decisions and profitability.

Understand the concept of hurdle rates and its application in investment decision-making.

Analyze the effects of non-uniform cash flows on the net present value calculations.

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Definitions:

Ratification Agency

The process by which a principal approves and accepts the acts of their agent that were done without proper authority or beyond the scope of their authority.

Implied Authority

Power not explicitly granted to an agent but necessary to carry out the agent's duties effectively.

Expressed Agency

A legal relationship where an agent is explicitly granted the authority by the principal to act on their behalf.

Apparent Agency

The legal doctrine that allows a third party to hold a principal liable for the acts of an agent, where the principal has given the appearance of agency.