Chris Was a Systems Analyst Hired to Determine the Best

question 140

Multiple Choice

Chris was a systems analyst hired to determine the best system for a retail china shop.After a careful analysis of the shop's needs and the available software,Chris presented a written report,which was approved by the owner of the business.Chris was paid his fee and was asked by the owner of the shop if he would act as agent in purchasing the hardware and software recommended in his report.The purchase was not to exceed $40 000 and the commission was to be $1000.Chris agreed.Read each of the following separately and indicate which is true.

• A)The agreement to act as agent fails to be a valid agency contract because it is not in writing.
• B)If Chris buys the hardware and software himself for $36 000 and sells it to the owner for $39 000,he is entitled to his commission because the price to the owner is still less than the price allowed.
• C)Chris will not be in breach of his fiduciary duty if he buys the recommended system from a firm in which he has an interest,even if he does not mention that fact to the owner.
• D)Chris is entitled to accept a commission from both the seller and the purchaser,as long as the total price paid by the purchaser is less than $40 000 and the hardware and software is comparable to that recommended in the report.
• E)Chris could be in breach of his duties if he delegated the task to someone else.

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Definitions:

Profits

The financial gain realized when the revenue from business activities exceeds the expenses, costs, and taxes needed to sustain the activity.

Command Economy

An economic system where the government controls key sectors of the economy, determining what goods should be produced, their prices, and allocation.

Supplied Equals Demanded

A market equilibrium condition where the quantity of goods or services produced and offered by sellers matches the quantity that buyers are willing and able to purchase.

Past Income

The amount of money an individual or entity earned in preceding periods, often used for comparative analysis or financial assessment.