MGT 401 Test 3 Questions With Correct
Answers
Classes of Agency - CORRECT ANSWER✔✔-Actual Authority, Apparent Authority,
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Ratification
Actual Authority - CORRECT ANSWER✔✔-Expressed - Agent can do what the
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principal specifically authorizes even if the agent obtains the authority through
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mistake, fraud or misrepresentation.
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Implied - Grant of authority by general language - Agent has the authority
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necessary to carry out the mandate.
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Apparent Authority - CORRECT ANSWER✔✔-Situations where the third party
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reasonably believes that the agent has authority.
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Manifestation by Principal - CORRECT ANSWER✔✔-Principal must do something
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or refrain from doing something
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Lingering Apparent Authority - CORRECT ANSWER✔✔-When actual authority has
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terminated, the principal must give notice to 3rd parties with whom the agent
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has dealt and who are known to the principal that the authority has been
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terminated.
, Duty of Loyalty - CORRECT ANSWER✔✔-Duty to avoid a conflict of interest.
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Respondeat Superior - CORRECT ANSWER✔✔-Principal is liable for the torts of
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his/her servants (i.e. agents, employees) while acting within the scope of
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employment.
Frolic and Detour - CORRECT ANSWER✔✔-Usually applies to drivers of vehicles -
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One who causes an injury to another after substantially deviating from the
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designated route, or while on personal business, will not impute liability on the
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part of the principal. Also, if injury is sustained by an unauthorized passenger,
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liability will not be imputed to the principal.
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Intentional Torts - CORRECT ANSWER✔✔-Intentional torts - Liability is imputed to
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|the principal if the agent thought he was benefiting the principal, even if no
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benefit was received. | |
Sole Proprietor Disadvantage - CORRECT ANSWER✔✔-All funding must come
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from one person through contribution of capital or borrowings
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Unlimited liability |
Types of Partnerships - CORRECT ANSWER✔✔-General Partnership, Limited
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partnership, Joint Venture, Limited Liability parntership
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Joint Venture - CORRECT ANSWER✔✔-Same as a partnership except it is created
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for a specific transaction and then terminated
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Answers
Classes of Agency - CORRECT ANSWER✔✔-Actual Authority, Apparent Authority,
| | | | | | | | |
Ratification
Actual Authority - CORRECT ANSWER✔✔-Expressed - Agent can do what the
| | | | | | | | | | |
principal specifically authorizes even if the agent obtains the authority through
| | | | | | | | | | |
mistake, fraud or misrepresentation.
| | |
Implied - Grant of authority by general language - Agent has the authority
| | | | | | | | | | | | |
necessary to carry out the mandate.
| | | | |
Apparent Authority - CORRECT ANSWER✔✔-Situations where the third party
| | | | | | | | |
reasonably believes that the agent has authority.
| | | | | |
Manifestation by Principal - CORRECT ANSWER✔✔-Principal must do something
| | | | | | | | |
or refrain from doing something
| | | |
Lingering Apparent Authority - CORRECT ANSWER✔✔-When actual authority has
| | | | | | | | |
terminated, the principal must give notice to 3rd parties with whom the agent
| | | | | | | | | | | | |
has dealt and who are known to the principal that the authority has been
| | | | | | | | | | | | | |
terminated.
, Duty of Loyalty - CORRECT ANSWER✔✔-Duty to avoid a conflict of interest.
| | | | | | | | | | |
Respondeat Superior - CORRECT ANSWER✔✔-Principal is liable for the torts of
| | | | | | | | | | |
his/her servants (i.e. agents, employees) while acting within the scope of
| | | | | | | | | | |
employment.
Frolic and Detour - CORRECT ANSWER✔✔-Usually applies to drivers of vehicles -
| | | | | | | | | | | |
One who causes an injury to another after substantially deviating from the
| | | | | | | | | | | |
designated route, or while on personal business, will not impute liability on the
| | | | | | | | | | | | |
part of the principal. Also, if injury is sustained by an unauthorized passenger,
| | | | | | | | | | | | |
liability will not be imputed to the principal.
| | | | | | |
Intentional Torts - CORRECT ANSWER✔✔-Intentional torts - Liability is imputed to
| | | | | | | | | |
|the principal if the agent thought he was benefiting the principal, even if no
| | | | | | | | | | | | | |
benefit was received. | |
Sole Proprietor Disadvantage - CORRECT ANSWER✔✔-All funding must come
| | | | | | | | |
from one person through contribution of capital or borrowings
| | | | | | | |
Unlimited liability |
Types of Partnerships - CORRECT ANSWER✔✔-General Partnership, Limited
| | | | | | | |
partnership, Joint Venture, Limited Liability parntership
| | | | |
Joint Venture - CORRECT ANSWER✔✔-Same as a partnership except it is created
| | | | | | | | | | | |
for a specific transaction and then terminated
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