Where the principal makes representations to a third party about the role that an agent is to play,which kind of authority can be created?

Question

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When the principal represents to a third party that the agent has the authority to act on their behalf, apparent authority is created. This is also known as ostensible authority, where the agent is perceived to have the authority to act, even if they do not have actual authority. This can occur through the principal's words, conduct, or other circumstances that lead a reasonable third party to believe that the agent has authority.

Where the Principal Makes Representations to a Third Party About