Chapter 33 Quiz

Interactive Quiz for ALT-12e, Chapter 33

Chapter 33 – Agency Liability and Termination

1. Under the equal dignity rule:

a. contracts are voidable by agents.

b. if a contract must be in writing to be executed, an agent’s authority must also be in writing.

c. if a contract between a principal and an agent lasts for longer than one year, it must be in writing.

d. the power of state legislatures to create agencies is equal to that of Congress.

Answers:

a. Incorrect. This is not what the equal dignity rule means.

b. Correct. This is what the equal dignity rule means.

c. Incorrect. This describes a Statute of Frauds requirement.

d. Incorrect. This is not what the equal dignity rule means.

2. When someone gives to another person a power of attorney, this means that:

a. the person who is given the power of attorney has implied authority, but not express authority, to act as an agent.

b. the person is an undisclosed principal.

c. the person is a disclosed principal.

d. the person is who is given the power of attorney has express authority to act as an agent.

Answers:

a. Incorrect. The power of attorney gives the party receiving it express authority to act as an agent.

b. Incorrect. The power of attorney does not make the party receiving it an undisclosed principal, but rather, an agent.

c. Incorrect. The power of attorney does not make the party receiving it a disclosed principal, but rather, an agent.

d. Correct. When a power of attorney is conferred on someone, this gives that person express authority to act as the agent of the other party.

3. When a principal causes a third party to reasonably believe an agent has authority to act on the principal’s behalf, even if the agent does not have such authority, this is known as:

a. anticipatory breach.

b. repudiation by act.

c. operation of law.

d. apparent authority.

Answers:

a. Incorrect. This is not an anticipatory breach.

b. Incorrect. This is not repudiation by act.

c....