What Is the Best Definition of a Fiduciary Relationship

question 13

Multiple Choice

What is the best definition of a fiduciary relationship?

• A)The principal pays the agent to act on his or her behalf.
• B)The principal grants an agent permission to act,either by words or conduct.
• C)A principal is liable for certain torts committed by an agent.
• D)The trustee must act in the best interests of the beneficiary.

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Definitions:

Payback Period

The length of time it takes for an investment to generate enough cash flow to recover its initial cost.

Salvage Value

The expected remaining valuation of an asset after its service life has ended.

Straight-Line Method

A method of allocating the cost of a tangible asset over its useful life in equal annual installments.

Net Present Value

A method used to evaluate the profitability of an investment, calculating the difference between the present value of cash inflows and outflows over a period.