When Do a Principal's Communications to an Agent Have an Impact

question 49

Multiple Choice

When do a principal's communications to an agent have an impact on whether the agent has apparent authority?

• A)Never.
• B)Only if the principal's communications to the agent become known to the third party or affect the agent's behavior.
• C)Only if the agent abuses his power and acts outside of his apparent and implied authority.
• D)Always.

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Definitions:

Ethics Scandal

An incident that involves allegations or occurrences of morally dubious behaviors or decisions by individuals or organizations.

Trust

A fiduciary relationship in which one party, known as the trustor, gives another party, the trustee, the right to hold title to property or assets for the benefit of a third party.

Sarbanes-Oxley Act

A U.S. law enacted in 2002 to protect investors by improving the accuracy and reliability of corporate disclosures.