The Role of Agency in Business Law: Help and Review Chapter Exam

Exam Instructions:

Choose your answers to the questions and click 'Next' to see the next set of questions. You can skip questions if you would like and come back to them later with the yellow "Go To First Skipped Question" button. When you have completed the practice exam, a green submit button will appear. Click it to see your results. Good luck!

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Question 1 1. Paul hires Andy to be his sports agent. Paul hires Andy specifically to negotiate his NFL contract for the upcoming football season. Shortly afterward, Paul breaks his leg and can't play football for several months. What is the state of this agency relationship?

Question 2 2. An agent can completely escape personal liability for a contract made with the authorization of the principal, as long as the principal:

Question 3 3. Leigh and Jennifer are friends. Leigh is looking for a new house, and Jennifer happens to work in real estate. Leigh can't make it to a showing for a house she's interested in and asks Jennifer to go look at the house for her. Leigh never hired Jennifer, but she tells the owners that Jennifer is coming on her behalf. Jennifer sees the house and knows Leigh will love it, so she makes an offer for Leigh. What is this an example of?

Question 4 4. Leigh hires Jennifer to be her real estate representative. Jennifer will help Leigh find a house to buy and has the authority to place bids for Leigh after Leigh decides to make an offer. In this scenario, Leigh is the:

Question 5 5. Michelle hires Chris to be her financial broker. A year later, Michelle asks for a report detailing her investments. Chris tells her he doesn't have that information. Chris has likely breached the duty of:

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Question 6 6. Paul hires Andy to be his sports agent. Paul hires Andy specifically to negotiate his NFL contract for the upcoming football season. Shortly afterward, Paul breaks his back and is paralyzed. He can't play football ever again. What is the state of this agency relationship?

Question 7 7. Maggie hires Monty to be her real estate agent. Monty goes to several open houses and makes a bid on one house. Monty never tells the homeowner that he is a real estate agent and that he is making the bid on Maggie's behalf. What is this an example of?

Question 8 8. Most contracts that are made under an agency relationship use which of the following?

Question 9 9. Pat hires Bob to be a bouncer at his nightclub. A patron starts a fight one night while Bob is working, and Bob tosses the patron out the door. Unfortunately, the patron landed on his head and died. What is the likely legal result?

Question 10 10. Maggie hires Monty to be her real estate agent. Monty goes to several open houses and makes a bid on one house. Monty tells the homeowner that he's a real estate agent and that he's working on Maggie's behalf. What is this an example of?

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Question 11 11. Karen hires Zack to be her financial broker. She gives him $10,000 to invest for her. Zack invests all of Karen's money in a risky startup company run by his best friend. Karen loses all of her investment. Zack has likely breached the duty of:

Question 12 12. Leigh hires Jennifer to be her real estate representative. Jennifer will help Leigh find a house to buy and has the authority to place bids for Leigh after Leigh decides to make an offer. Leigh and Jennifer have a written contract. What is this an example of?

Question 13 13. Bob hires Charlene to be his financial broker. He asks her to invest $10,000 in a particular stock. Bob finds out that the stock isn't doing well, and that the company is about to declare bankruptcy. Charlene instead invests Bob's money in another, similar company. Bob is later surprised when he receives a stockholder letter from that company. Charlene has likely breached the duty of:

Question 14 14. Sally is a contractor and hires Steve to paint a client's house on her behalf. Sally tells Steve to buy 3 gallons of White House White paint for the house and gives Steve that money. However, it's not enough paint. Steve has to buy one more gallon in order to complete Sally's request. When Steve seeks reimbursement from Sally, she refuses. Sally has likely breached the duty of:

Question 15 15. With what authority does the agent act with in order for a principal to be bound by a contract?

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Question 16 16. Paul hires Andy to be his sports agent. Paul hires Andy specifically to negotiate his NFL contract for the upcoming football season. Andy tries, but there aren't any NFL teams currently interested in Andy and recruiting season is now over. What is the state of this agency relationship?

Question 17 17. Bart hires Bernie to be his talent agent. Bart tells Bernie to find work for him as an actor and provides Bernie with a full portfolio including his head shots and resume. Bart sends Bernie to meet with potential employers, but tells Bernie not to sign anything until Bart has a chance to review the offer. Bernie proceeds to negotiate and sign an acting contract on Bart's behalf. What is this an example of?

Question 18 18. Leigh hires Jennifer to be her real estate representative. Jennifer will help Leigh find a house to buy and has the authority to place bids for Leigh after Leigh decides to make an offer. In this scenario, Jennifer is the:

Question 19 19. Sally is a contractor and hires Steve to paint a client's house on her behalf. Sally tells Steve to keep track of his expenses and then bill her at the end of the project. Steve gives Sally a bill for $300, but Sally refuses to pay more than $50. Steve spent almost $200 just on paint, and spent three days on the project. Steve wants to be fairly paid for his work. Sally has likely breached the duty of:

Question 20 20. Maria hires Carl to be her financial broker. She asks Carl to invest $10,000 in a particular stock. The stock is for a startup company run by Maria's friend. After researching the company, Carl decides it's a great investment and decides to invest $10,000 of his own money, too. Carl has likely breached the duty of:

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Question 21 21. Maggie hires Monty to be her real estate agent. Monty goes to several open houses and makes a bid on one house. Monty tells the homeowner that he is a real estate agent and that the bid is on behalf of a client, but never mentions that he is working on behalf of Maggie. What is this an example of?

Question 22 22. Leigh and Jennifer are friends. Jennifer works in real estate and finds a great house for Leigh, though Leigh never hired Jennifer or asked Jennifer to work on her behalf. After Leigh sees the house, she loves it and moves forward with the negotiations Jennifer started. What is this an example of?

Question 23 23. Harry hires Carol to be his financial broker. He asks Carol to invest $10,000 in a particular stock. Later he finds that Carol invested his money in a different stock. Carol has likely breached the duty of:

Question 24 24. Sally is a contractor and hires Steve to demolish a kitchen so she can start building a new one. Steve completes the work, and later finds out the walls contained asbestos. Sally knew this but didn't tell Steve. Sally has likely breached the duty of:

Question 25 25. Bart signs an agreement with Bernie to be his talent agent. Bart asks Bernie to negotiate and make acting contracts on his behalf. What is this an example of?

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Question 26 26. Bart hires Bernie to be his talent agent. Bart tells Bernie to find work for him as an actor. Bernie then negotiates and makes an acting contract on Bart's behalf. What is this an example of?

Question 27 27. Sally is a contractor and hires Steve to demolish a kitchen on her behalf so she can start building a new one. Steve gives Sally an estimate for his work. Sally agrees with the estimate and tells Steve she'll pay him at the end of the project, after the homeowners pay her. Steve completes the work, and presents Sally with his bill. Sally pays him, but not until the end of the project. Sally has likely breached the duty of:

Question 28 28. Parker hires Lenny to be a limousine driver for his company. While working one night, Lenny starts a fight with a passenger. Lenny pulls out a knife and threatens to stab the passenger. What is the likely legal result?

Question 29 29. What does the doctrine of respondeat superior allow for?

Question 30 30. Which of the following is NOT a reason for a principal to be held directly liable for an agent's acts?

The Role of Agency in Business Law: Help and Review Chapter Exam Instructions

Choose your answers to the questions and click 'Next' to see the next set of questions. You can skip questions if you would like and come back to them later with the yellow "Go To First Skipped Question" button. When you have completed the practice exam, a green submit button will appear. Click it to see your results. Good luck!

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