If You Hire Gnowsky to Act as Your Agent, Which

question 102

Multiple Choice

If you hire Gnowsky to act as your agent, which of the following is true with regard to the duties he owes to you?

• A) Gnowsky need not use reasonable care, skill, and diligence in his service to you.
• B) Even when Gnowsky is acting as your agent, he need not put your interest above his own.
• C) An agent may delegate his authority without the authorization of his principal.
• D) His failure to obey you and to act within the authority given him would allow you to sue him for breach of contract.
• E) Gnowsky need not tell you everything relevant to his task that a reasonable person would consider might affect your decision making.

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Definitions:

Carrying Amount

The book value of an asset or liability; for assets, it is typically based on original cost less depreciation.

Straight-Line Amortization

A method of evenly allocating the cost of an intangible asset over its useful life.

Callable

A term used to describe a financial security that the issuer can redeem prematurely under specific conditions.

Outstanding Debt

The total amount of borrowed money a company or individual has yet to repay to creditors.