11th Class Business Studies Forms Of Business Organisation Question Bank Forms Of Business Organisation (Short)

  • question_answer
    Explain the concept of mutual agency in partnership with suitable example.


    Ans.     The right of all the partners in a partnership to act as the agents for the partnership's normal business activities, with the authority to bind the partnership into business agreements which have been entered into is called mutual agency. This statement sums up the partnership relationship. The relationship should offer flexibility, opportunity and balanced against that, risk. In partnership you entrust to fellow partners your future reputation and prosperity. Each of us has within our power the ability to enter into undertakings which could bankrupt our fellow partners.

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