Which of the following is true of an apparent agency?

Question

Quizplus · Accepted Answer

An apparent agency arises when a third party reasonably believes that an individual has been given authority to act as an agent of a principal, even though no actual authority may exist. In such situations, the principal is bound to the contracts entered into by the apparent agent, even if the agent lacked authority. Therefore, option C is the correct answer. Option A is incorrect because it refers to implied authority, which is different from apparent agency. Option B is incorrect because a third-party would be bound to the contract created by an apparent agent. Option D is incorrect because apparent agency is created by the actions or words of the principal, rather than the apparent agent.

Which of the Following Is True of an Apparent Agency