60. You post a notice at school that you will sell your laptop computer for $600. A buyer comes by your room to look at
it while you are gone and your roommate sells it for $500, thinking you would be happy with that price, which you
did not authorize.
a. you must accept the deal because your roommate had implied authority
b. you must accept the deal because people living together have power of attorney
c. you can accept the deal by express or implied ratification
d. you can accept the deal by express ratification only, not implied ratification
e. the deal cannot be valid because there was no consent
61. You post a notice at school that you will sell your laptop computer for $600. A buyer comes by your room to look at
it while you are gone and your roommate sells it for $500, thinking you would be happy with that price, which you
did not authorize.
a. you must accept the deal because your roommate had implied authority
b. you must accept the deal because people living together have power of attorney
c. the deal cannot be valid because there was no consent
d. you can accept the deal by express ratification only
e. none of the other choices
62. An alleged principal becomes a real principal by:
a. ratifying the agreement
b. refusing to ratify the agreement
c. suing the alleged agent
d. signing the power of attorney
e. signing a contract
63. Express ratification creating an agency by the principal occurs when the principal:
a. fails to object to an agent’s unauthorized activities
b. by action shows a clear intent to be bound by unauthorized acts of the agent
c. accepts the benefits of an unauthorized agreement with a third party
d. all of the other specific choices
e. none of the other choices
64. A(n) is a principal’s clear signal to be bound to the otherwise unauthorized agreement.
a. implied ratification
b. real ratification
c. delayed ratification
d. express ratification
e. explicit ratification
65. A(n) is a principal’s clear signal to be bound to the otherwise unauthorized agreement.
a. implied ratification
b. real ratification
c. delayed ratification
d. explicit ratification
e. none of the other choices are correct
66. Implied ratification of an agency occurs when the principal:
a. fails to object to the unauthorized activities of an agent
b. by action shows a clear intent to be bound by unauthorized acts of the agent
c. accepts the benefits of an unauthorized agreement with a third party
d. fails to object to the unauthorized activities of an agent and accepts the benefits of an unauthorized
agreement with a third party
e. fails to object to the unauthorized activities of an agent and accepts the benefits of an unauthorized
agreement with a third party and by action shows a clear intent to be bound by unauthorized acts of the
agent
67. takes place when the principal behaves as if he has the intent of ratifying an unauthorized agreement.
a. implied ratification
b. real ratification
c. delayed ratification
d. express ratification
e. explicit ratification
68. takes place when the principal behaves as if he has the intent of ratifying an unauthorized agreement.
a. explicit ratification
b. real ratification
c. delayed ratification
d. express ratification
e. none of the other choices are correct
69. Implied ratification usually occurs when:
a. the principal refuses to accept the benefits of the agreement
b. the principal accepts the benefits of the agreement
c. the agent accepts the benefits of the agreement
d. a court processes the power of attorney
e. none of the other choices are correct
70. To ratify an agreement a principal must know:
a. the important facts of the agreement
b. a general outline of the agreement
c. the name of the agent
d. the agent for at least two years
e. none of the other choices are correct
71. Ratification of an agreement that is required by law to be in writing:
a. need not be in writing
b. must be in writing
c. must be witnessed by a court official
d. must be in writing unless both parties agree that it need not be
e. must be verbal
72. Ratification of an agreement that is required by law to be in writing:
a. need not be in writing
b. must be verbal
c. must be witnessed by a court official
d. must be in writing unless both parties agree that it need not be
e. none of the other choices are correct
73. Clark, a movie producer, was allowed to work at a movie production company‘s offices (ITC) out of courtesy. His
business card listed the ITC address and his phone calls were handled by ITC staff. In the office, he made a deal to
produce a movie for another company. When problems developed and the company, presuming Clark worked for
ITC, sued ITC. The court would be likely to hold that ITC:
a. ratified Clark’s actions and so became liable for his actions
b. expressly accepted contracts negotiated by Clark, so was liable for the failure to perform
c. had no liability because Clark merely was allowed to use office space at ITC
d. had no liability because Clark had no authority to represent ITC in movie decisions
e. none of the other choices
74. Which of the following would not be a factor in determining a ratification:
a. the principal can ratify only agreements about which he has knowledge of the material facts
b. the agent must have purported to act for of the principal and not on the agent’s own behalf
c. the third party wishes for the principal to be a party to a contract
d. if the original agreement between the agent and third party was required by law to be in writing, ratification
must also be in writing
e. all of the other choices
75. Agency by estoppel means:
a. conduct on the part of the agent that implies an agency relationship must be stopped as soon as the principal
implies disagreement
b. actions by the principal lead a person to believe that the presumed agent has authority to act on the
principal’s behalf
c. the agent creates an appearance of authority in the principal which leads a third party to reasonably conclude
that the agent has the authority to perform certain acts
d. conduct by the agent through word or actions is not sufficient to bind the principal to contracts the agent
creates
e. none of the other choices
76. Agency by estoppel means:
a. conduct on the part of the agent that implies an agency relationship must be stopped as soon as the principal
implies disagreement
b. the principal has ratified actions of the agent in the past, creating the impression of a formal agency
c. the agent creates an appearance of authority in the principal which leads a third party to reasonably conclude
that the agent has the authority to perform certain acts
d. conduct by the agent through word or actions is not sufficient to bind the principal to contracts the agent
creates
e. none of the other choices
77. is when an agency is created because the actions of the principal may lead one to reasonably believe that the
presumed agent has the authority to act for the principal.
a. Agency by estoppel
b. Agency by permission
c. Agency by ratification
d. Agency by demand
e. Agency by practicality
78. is when an agency is created because the actions of the principal may lead one to reasonably believe that the
presumed agent has the authority to act for the principal.
a. Agency by practicality
b. Agency by permission
c. Agency by ratification
d. Agency by demand
e. none of the other choices are correct
79. An agency through operation of law is established:
a. by a written contractual agreement of the parties
b. by ratification of the agent’s activities by the principal
c. by the application of the doctrine of estoppel
d. when an emergency exists and the “agent’s” actions are in the public interest
e. none of the other choices
80. An agency through operation of law is established:
a. by a written contractual agreement of the parties
b. by ratification of the agent’s activities by the principal
c. by the application of the doctrine of estoppel
d. when the legislature authorizes an agency
e. none of the other choices
81. Operation of law provides agents with the authority to act beyond the authority granted by the principal when:
a. an agent has a good idea
b. an agent has an opportunity to make a profit for the principal through his actions
c. an agent understands all the risks
d. an emergency exists
e. the principal fails to make the right decision
82. Operation of law provides agents with the authority to act beyond the authority granted by the principal when:
a. an agent has a good idea
b. an agent has an opportunity to make a profit for the principal through his actions
c. an agent understands all the risks
d. the principal fails to make the right decision
e. none of the other choices are correct
83. Suppose a hurricane is going to hit South Florida; there are two days to prepare for it and the owner of a house is
on a raft trip in Brazil and cannot be reached. The next door neighbors spend $800 on plywood and other materials
to protect the house from the hurricane. Legally, this expenditure is likely to be:
a. is a gift from the neighbors, nothing more
b. is the responsibility of the homeowner; there is an agency by estoppel
c. is the responsibility of the homeowner; there is implied ratification of the agency
d. is the responsibility of the homeowner; there is agency by operation of law
e. none of the other choices
84. Suppose a hurricane is going to hit South Florida; there are two days to prepare for it and the owner of a house is
on a raft trip in Brazil and cannot be reached. The next door neighbors spend $800 on plywood and other materials
to protect the house from the hurricane. Legally, this expenditure:
a. is a gift from the neighbors, nothing more
b. is the responsibility of the homeowner; there is an agency by estoppel
c. is the responsibility of the homeowner; there is implied ratification of the agency
d. is the responsibility of the homeowner; there is express ratification of the agency
e. none of the other choices
85. When you go on vacation you give your neighbor authority to pick up your mail and watch for burglars for you. You
tell the neighbor not to go into the house or let anyone else in. A fire on the hills threatens your house. The neighbor
goes in to carry out valuables before the house burns. This action is:
a. a trespass, which is illegal
b. breaking and entering, which is a crime
c. an agency by estoppel
d. an agency through operation of law
e. an agency by implied ratification
86. When you go on vacation you give your neighbor authority to pick up your mail and watch for burglars for you. You
tell the neighbor not to go into the house or let anyone else in. A fire on the hills threatens your house. The neighbor
goes in to carry out valuables before the house burns. This action is:
a. a trespass, which is illegal
b. breaking and entering, which is a crime
c. an agency by estoppel
d. an agency by implied ratification
e. none of the other choices
87. A key element of an agency relationship is:
a. an agent’s ability to transact business for the principal
b. any relationship established for the sale of land be an oral contract
c. the principal acts for the benefit of the agent
d. a commitment for at least one year, to show intent to bind the parties to the agency relationship
e. none of the other choices
88. The scope of an agent’s authority is determined from the:
a. oral or written expressions of the principal
b. principal‘s conduct
c. customs in the business for which the agent is employed
d. oral or written expressions of the principal or the principal’s conduct
e. oral or written expressions of the principal or the principal’s conduct or the customs in the business for which
the agent is employed
89. The scope of an agent’s authority is determined from the:
a. oral or written expressions of the principal
b. principal‘s conduct
c. standards of the Uniform Agency Act
d. oral or written expressions of the principal or the principal’s conduct
e. oral or written expressions of the principal or the principal’s conduct or the standards of the Uniform Agency
Act
90. Which of the following determines the scope of authority given to an agent:
a. statements of the principal
b. the principal’s conduct
c. the trade customs in business
d. all of the other specific choices are correct
e. none of the other specific choices are correct
91. Which of the following can determine the scope of authority given to an agent:
a. statements of the agent
b. the principal‘s personal relationship with the agent
c. the trade customs in business
d. all of the other specific choices are correct
e. none of the other specific choices are correct
92. Which of the following can determine the scope of authority given to an agent:
a. statements of the agent
b. the principal’s personal relationship with a third party
c. the principal’s conduct
d. all of the other specific choices are correct
e. none of the other specific choices are correct
93. Which of the following can determine the scope of authority given to an agent:
a. statements of the agent
b. the principal’s personal relationship with a third party
c. statements of the principal
d. all of the other specific choices are correct
e. none of the other specific choices are correct
94. If an agent claims to have authority but in fact has none, the principal is:
a. not responsible for the agent‘s dealings with third parties who have no reason to think the agent has authority
b. responsible for the agent’s dealings with third parties who have no reason to think the agent has authority
c. responsible for up to 50% of the monetary value of any contracts entered into by third parties and the agent
d. responsible for up to 25% of the monetary value of any contracts entered into by third parties and the agent
e. none of the other choices are correct
95. The agent’s ability to transact business on behalf of and for the principal depends on whether the agent possesses:
a. actual authority
b. apparent authority
c. quasi-authority
d. actual or apparent authority
e. actual or apparent authority or quasi-authority
96. The authority given by the principal to an agent, conferring on the agent the power and right to change the
principal’s legal status is referred to as:
a. actual authority
b. authority in rem
c. authority at law
d. general authority
e. special authority
97. The authority given by the principal to an agent, conferring on the agent the power and right to change the
principal’s legal status is referred to as:
a. special authority
b. authority in rem
c. authority at law
d. general authority
e. none of the other choices
98. is the authority given by the principal to the agent.
a. artificial authority
b. actual authority
c. legitimate authority
d. general authority
e. total authority
99. Actual authority give the agent:
a. no real authority
b. the power and right to change the principal‘s legal status
c. the power and right to make all decisions for the principal, even on matters where the agent does not have
authority
d. a 50% ownership share in all the principal‘s assets
e. none of the other choices are correct
100. Express authority consists of the agent’s:
a. inability to conduct business for the principal
b. ability to mingle his funds with those of the principal
c. written or oral instructions from principal to agent
d. ability to hold power of attorney for the principal
e. ability to withhold services in the event of nonpayment by the principal
101. Express authority consists of the agent’s:
a. inability to conduct business for the principal
b. ability to mingle his funds with those of the principal
c. ability to withhold services in the event of nonpayment by the principal
d. ability to hold power of attorney for the principal
e. none of the other choices
102. consists of oral or written instructions given by the principal to an agent.
a. substitute authority
b. express authority
c. implied authority
d. quasi authority
e. legal authority
103. consists of oral or written instructions given by the principal to an agent.
a. substitute authority
b. legal authority
c. implied authority
d. quasi authority
e. none of the other choices are correct
104. Implied authority consists of:
a. the power to do whatever is reasonable and customary to carry out the agency purpose
b. the power to mingle the funds of the agent and principal
c. limits on an agent’s actions, so that the agent may only do what the principal orders, in writing or orally
d. the power of the agent to withhold services if the principal fails to pay her
e. the power of an agent to do whatever is authorized by the Uniform Agency Act
105. Implied authority consists of:
a. the power of an agent to do whatever is authorized by the Uniform Agency Act
b. the power to mingle the funds of the agent and principal
c. limits on an agent’s actions, so that the agent may only do what the principal orders, in writing or orally
d. the power of the agent to withhold services if the principal fails to pay her
e. none of the other choices
106. The power of an agent to do whatever is reasonable and customary to carry out the agency purpose is given by:
a. express authority
b. implied authority
c. quasi authority
d. false authority
e. verbal authority
107. The power of an agent to do whatever is reasonable and customary to carry out the agency purpose is given by:
a. express authority
b. verbal authority
c. quasi authority
d. false authority
e. none of the other choices are correct
108. When a principal creates an impression of authority in an agent that leads a third party to conclude that the agent
has authority to act for the principal, the agent is said to have:
a. implied authority
b. express authority
c. actual authority
d. apparent authority
e. none of the other choices
109. When a principal creates an impression of authority in an agent that leads a third party to conclude that the agent
has authority to act for the principal, the agent is said to have:
a. implied authority
b. express authority
c. legalized authority
d. actual authority
e. none of the other choices
110. Apparent authority arises when:
a. the principal creates an appearance of authority in an agent that leads a third party to conclude reasonably
that the agent has authority to act for the principal
b. the agent creates an appearance of authority in a principal that leads a third party to conclude reasonably
that the agent has authority to act for the principal
c. the agent forges documents conferring authority on himself
d. the principal gives the agent implied authority
e. none of the other choices are correct
111. In Cove Management v. AFLAC, Galgano, an independent contractor who solicited insurance business for
AFLAC, rented office space from Cove under AFLAC’s name. When Galgano defaulted on payments, Cove
sued AFLAC contending that Galgano was its agent when he rented the office, so AFLAC was liable. The
appeals court held that AFLAC:
a. was not obligated to the lease because real estate deals must be in writing with the principal of the
company agreeing to the lease
b. was not obligated to the lease because Galgano did not have apparent authority to sign a lease that would
bind AFLAC
c. was obligated on the lease as its employee had apparent authority
d. was not obligated on the lease, but its employee who told Galgano it was ok to enter into such a lease was
obligated
e. all of the other choices are correct
112. In Cove Management v. AFLAC, Galgano, an independent contractor who solicited insurance business for
AFLAC, rented office space from Cove under AFLAC’s name. When Galgano defaulted on payments, Cove
sued AFLAC contending that Galgano was its agent when he rented the office, so AFLAC was liable. The
appeals court held that AFLAC:
a. was not obligated to the lease because real estate deals must be in writing with the principal of the
company agreeing to the lease
b. was not obligated to the lease because Galgano did not have universal agent authority to sign a lease to
bind AFLAC
c. was obligated on the lease as its employee had apparent authority
d. was not obligated on the lease, but its employee who told Galgano it was ok to enter into such a lease was
obligated
e. all of the other choices are incorrect
113. In Cove Management v. AFLAC, Galgano, an independent contractor who solicited insurance business for
AFLAC, rented office space from Cove under AFLAC’s name. When Galgano defaulted on payments, Cove
sued AFLAC contending that Galgano was its agent when he rented the office, so AFLAC was liable. The
appeals court held that:
a. the district court was correct in its ruling that AFLAC was not bound by the contract because Galgano did
not have apparent authority
b. the district court was correct in its ruling that AFLAC was bound by the contract because Galgano had
apparent authority
c. the district court was incorrect in its ruling that AFLAC was bound by the contract because Galgano did
not, in fact, have apparent authority
d. the district court was incorrect in its ruling that AFLAC was not bound by the contract because Galgano
had express authority
e. none of the other choices are correct