If You Hire Gnowsky to Act as Your Agent, Which

question 80

Multiple Choice

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

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

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Definitions:

Consumer Surplus

The economic benefit derived by consumers from being able to purchase a product for a price that is less than the maximum price they are willing to pay.

Equilibrium Price

The price at which the quantity of a good demanded by consumers equals the quantity supplied by producers, resulting in a stable market condition.

Price Floor

A government- or authority-imposed minimum price that can be charged for a product or service, often above the equilibrium price.

Network Externality

A situation where the value of a product or service increases as more people use it.