A principal-agent relationship exists when an employer hires an employee to perform some form of physical service.

Question

Quizplus · Accepted Answer

A principal-agent relationship exists when one party (the principal) hires another party (the agent) to act on their behalf. In the given question, the employer is the principal and the employee is the agent. The agent is hired to perform a task on behalf of the principal, not to perform a physical service.

A Principal-Agent Relationship Exists When an Employer Hires an Employee