Prentice and Mercedes are partners in a catering business.The law of agency:
A) will only affect their business if they hire independent contractors.
B) will only affect their business if they hire employees.
C) has no significance for their business.
D) is important to their business because both Prentice and Mercedes are agents of the partnership and as such have the authority to represent and bind the business in all usual transactions of that partnership.

Question

Quizplus · Accepted Answer

The law of agency is crucial in a partnership because each partner acts as an agent of the partnership. This means they have the authority to make decisions, enter into contracts, and undertake obligations on behalf of the business in the usual course of its operations, thereby binding the partnership.

Prentice and Mercedes Are Partners in a Catering Business