In Making Promises That Are Not Guaranteed by Third Parties

question 8

Multiple Choice

In making promises that are not guaranteed by third parties and in imposing penalties that are not enforced by third parties,all of the following are credibility-enhancing mechanisms except

• A) establishing a bond forfeited by violating the commitment
• B) investing in a non-redeployable reputational asset tied to the promise or threat
• C) interrupting the communication of negotiated compromises
• D) offering a warranty
• E) delivering a hostage (e.g.,a patent license triggered by violating the promise)

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Definitions:

Actual Authority

The express and implied powers given to an agent by a principal, allowing the agent to act on behalf of the principal.

Conduct

The manner in which a person behaves, especially in a particular place or situation.

Unauthorized Contract

An agreement made by a person who does not have the legal authority to do so on behalf of a party.

Ratifies

The act of formally approving or confirming a decision or agreement, making it officially valid.