What type of relationship has formed when the parties have agreed that one person will have power to bind the other person in contract?

A) Principal-agent
B) Employer-employee
C) Employer-independent contractor
D) Employer-agent
E) Principal-independent contractor

Principal-Agent Relationship

A legal relationship where one party (the agent) acts on behalf of another party (the principal) in business transactions.

Power to Bind

The authority granted to an agent or representative to enter into contracts or agreements that legally bind the principal to the terms.

Contract

An agreement between two or more parties creating obligations that are enforceable or otherwise recognizable by law.