The three parties in an agency relationship and the function of each are the principal (the person giving the direction), the agent (the person doing the action at the principal's direction), and _____.
Answer
A
the third person or beneficiary (the person who benefits from the agent's action)
B
the defendant (the person defending the actions of the agent)
C
the coordinator (the person who deals with the logistics of the action)
D
the administrator (the person in charge of the administration)
Explanation
An agency relationship involves a principal, who authorizes an agent to act, and the agent, who carries out the authorized action. The third party is the person or entity the agent interacts with on the principal’s behalf; that person may benefit from the action. Therefore, the correct choice is “the third person or beneficiary.”
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