The authority that a third party may reasonably assume an agent possesses, despite the fact that the agent does not actually possess such authority, is known as:

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Apparent authority is the authority that a third party may reasonably assume an agent possesses, despite the fact that the agent does not actually possess such authority. This can occur when an agent's actions or words lead the third party to believe that the agent has the authority to act on behalf of the principal.

The Authority That a Third Party May Reasonably Assume an Agent