NCA Business Organizations Practice Questions - NCA Business Organizations (Business Associations) Examination Exam

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P appoints A as a sales manager and tells A privately never to offer discounts above 10%. Without P's knowledge, A offers a 25% discount to a customer who is unaware of the limit, and the customer accepts. Is P bound by the contract?

No, because A acted beyond the express limit P set No, because a principal is never bound by an agent's unauthorized acts Yes, because A had apparent authority arising from the position P placed A in Yes, but only if P later ratifies the discount

Correct Answer:

Yes, because A had apparent authority arising from the position P placed A in

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