Wednesday, October 12, 2011

Agency MCQ (1-10)

1. Which of the following constitute an act of strict dominion or ownership?

a. To bind the principal to render some service without compensation.
b. To sue for the collection of debts.
c. To lease real property to another person for six (6) months.
d. To make customary gifts for charity.

ANSWER: A


2. There is no implied agency in the following:

a. The principal delivers his power of attorney to the agent and the latter receives it without any objection.
b. The offeree writes a letter acknowledging the receipt of the offer, but offers no objection to the agency.
c. The offeree begins to act under the authority conferred upon him.
d. The offeree receives a letter of authority but did not reply nor acted within the scope of authority conferred upon him.

ANSWER: D


3. Lease of services is distinguished from agency except on the following:

a. The worker does not represent his employer.
b. The implementor exercises discretionary powers.
c. Generally, the relationship can be terminated only at the will of both parties.
d. It usually involves only two (2) parties.

ANSWER: B


4. The power to sell does not carry with it the power to:

a. Find a purchaser or to sell directly.
b. To pledge.
c. Make usual representations and warranty.
d. To deliver the property.

ANSWER: B


5. The agent, in excess of the authority given to him by his principal enters into a contract with a third person. If the principal ratifies the contract, who will be liable to the third parties, if any?

a. Only the principal.
b. Only the agent.
c. Both the principal and the agent jointly.
d. Both the principal and the agent solidarily.

ANSWER: A


6. If the agent contracts in the name of his principal, exceeding the scope of his authority, what would be the status and effect of the contract if the other party knows that he (agent) is unauthorized?

a. Void contract
b. Voidable contract
c. Unenforceable contract
d. Rescissible contract

ANSWER: A


7. Agency is not extinguished by -

a. Withdrawal of the agent
b. Appointment of a substitute against the prohibition of the principal.
c. Accomplishment of the purpose.
d. Death of the principal.

ANSWER: B


8. Which of the following is not a fundamental obligation of an agent?

a. To borrow if he is authorized to lend.
b. To subordinate his interest in favor of his principal if there is a conflict of interest.
c. To render an accounting of the transaction.
d. Not to carry out the agency, even if that is the instruction of the principal, if he knew it would result to a loss or damage to his principal.

ANSWER: A


9. The principal is not liable for the expenses incurred by the agent:

a. When it was stipulated by that the agent would only be allowed a certain sum. 
b. When the agent has complied with his obligations by acting according to the principal's instructions.
c. When the agent incurred them with the knowledge that an unfavorable result would ensue and the principal was aware of it.
d. When the expenses were incurred without the fault of the agent.

ANSWER: A


10. When two or more persons have appointed an agent for common transaction or undertaking, their liability to the agent for all consequences of the agency is:

a. Solidary
b. Joint
c. Subsidiary
d. Secondary

ANSWER: A








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