Which of the Following Is True of a Subagent's Duties

question 30

Multiple Choice

Which of the following is true of a subagent's duties to a principal?

• A) A subagent does not owe the agent any of the duties that agents owe their principals.
• B) A subagent who knows of the original principal's existence also owes that principal all the duties agents owe their principals except for duties arising solely from the original principal's contract with the agent.
• C) The agent who appoints the subagent is not liable to the original principal when he/she is harmed by the subagent's conduct.
• D) A subagent owes the original principal for duties arising solely from the original principal's contract with the agent.

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Definitions:

Sole Proprietorships

A business owned and operated by a single individual with no distinction between the business and owner.

Tax Advantage

Financial benefits that apply to certain accounts or investments which are provided to encourage specific behaviors, such as saving for retirement. These advantages can lead to a reduction in tax liability.

Personal Liabilities

Debts or obligations that an individual is responsible for, as opposed to those belonging to businesses or governmental entities.

Limited Partners

Investors in a partnership who have limited liability to the extent of their investment in the partnership. They do not partake in the day-to-day management of the business.