Question

From a business perspective, discuss ....

--why is it important to understand agency relationships?

--what is the relevance of an agent?

--who is considered an agent AND who can be an agent?

Answer 1

A business should having an Agency Relationship. The agent and the principal will always involves in a agency relationship. Both the principal and agent may be individual or a business entities. In the business transactions, the agent will legally authorised to act on behalf of other party. A principal is the business entity or individual who is giving the legal authority to an agent . Every agency relationship in business must be a confident and trusted relationship. So it is important to understand agency relationship in business.

A agent having an great relevance in the business. The major duites of an agent in the business transactions are as follows:

• The agent is under the control of principal and act on behalf .
• He will act under the power and authority of his principal.
• With careful and proper way he/she will discharge their duties.
• The agent will avoid his/her personal interest in the business of their principal.

When an agent will obeying the above duites, then he is the trusted agent in an business. Overall they must be act as a broker or agent of their principal to flourish the business transactions of their principal.