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​In a situation where a car salesman is selling cars on behalf of the dealer, the...

​In a situation where a car salesman is selling cars on behalf of the dealer, the salesman is the

a. ​Principal b. ​Agent c. ​Both of the above c. ​None of the above

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Answer #1

Answer- The correct option is B ie., Agent. An agent is a person who is employed by the principal to act on his or her behalf and hence he or she has the authority level given by the principal to act on his or her behalf. While a principal is a person who appoints some other person who will be acting on his or her behalf. Any relation where one acts on behalf of another person can be termed as agency relationship.

In the above mentioned scenario, the car salesman is acting or selling cars on behalf of the dealer who own the workshop, thus, the car sales man is an agent of the dealer and the dealer here is the principal.

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