Future Business Leaders of America (FBLA) Business Law Practice Exam

Which type of agent is typically described as having broader authority?

1. General agent

2. Special agent

3. Subagent

4. Limited agent

The correct answer is: General agent

A general agent is characterized by having broader authority as compared to other types of agents. This type of agent is authorized to perform a wide range of tasks and make decisions on behalf of the principal, essentially managing the principal’s affairs in a comprehensive manner. For example, a general agent can handle various business operations, negotiate contracts, and make overall business decisions without needing to seek approval for each individual action. In contrast, a special agent is limited to performing a specific task or a series of tasks, and their authority is restricted to those defined parameters. A limited agent similarly has a scope of authority that is not as extensive as that of a general agent. A subagent operates under the authority granted by another agent and thus typically has even more limited powers, relying on the parameters set by the primary agent. This distinction in authority showcases the depth of responsibility and decision-making power that comes with being a general agent, making it the correct choice in this context.