In Certain Cases,a Third Party Can Hold a Principal to a Contract

question 94

Multiple Choice

In certain cases,a third party can hold a principal to a contract even though the agent acted outside the authorization given him by his or her principal and even though his or her principal elected not to ratify the contract made by the agent.The third party can enforce the contract because of:

• A)the reasonable agent theory.
• B)the agent's apparent authority.
• C)agency by express agreement.
• D)fiduciary duty.
• E)the failure of the principal to register the agency agreement.

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Definitions:

Reward System

A set of mechanisms for distributing both tangible and intangible returns as part of an employment relationship.

Compensation System

A framework used by organizations to plan, implement, and manage how employees are paid for their work, including salaries, bonuses, and benefits.

Base Pay

The initial rate of compensation an employee receives before any bonuses, benefits, or additional pay is added.

Incentives

Motivations or rewards offered to encourage specific behaviors or actions in individuals or groups.