1/20 Business Organizations
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A collection of vocabulary flashcards derived from a business organizations lecture, covering key concepts such as agency law and fiduciary duties.
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15 Terms
Agency Law
The law of delegation, where one party (the principal) delegates tasks or authority to another party (the agent).
Principal
The person who delegates authority to an agent, who acts on their behalf.
Agent
The individual who acts on behalf of the principal, undertaking tasks or responsibilities.
Fiduciary Duty
A legal obligation of one party to act in the best interest of another, creating a relationship of trust and confidence.
Duty of Care
An agent's obligation to act competently and diligently in carrying out responsibilities for the principal.
Duty of Loyalty
An agent's obligation to act in the best interests of the principal, putting the principal's interests above their own.
Actual Authority
Authority granted to the agent by the principal, either explicitly or implicitly, to act on their behalf.
Apparent Authority
Authority that a third party reasonably believes the agent has based on the principal's actions or statements.
Tort Liability
Legal responsibility of a principal for the negligent actions of an agent performed within the scope of their employment.
Contract Liability
The circumstances under which a principal is bound to a contract entered into by their agent.
Agency Costs
Costs associated with incentives and monitoring in an agency relationship, aimed at aligning the interests of the principal and the agent.
Mutual Assent
The mutual agreement between the principal and agent to enter into an agency relationship.
Termination of Agency Relationship
The conclusion of the agency relationship, which can occur when the purpose is fulfilled, a party dies, or either party opts out.
Cold Calling
A method of participation in which the instructor randomly selects students to respond or engage during class.
Canvas
The online platform used by the professor to communicate with and provide materials to students.
Flashcards (23)