Question

Seller Joe Needy lists his home for $40,000 and the broker tells the prospective buyer to submit a low offer because the seller is desperate. The buyer offers $38,000 and the seller accepts. Which statement is TRUE about this situation?

A: the broker was unethical but because no one was hurt,it is not improper
B: the broker violated the realationship
C: the broker's action was proper in obtaining a quick offer
D: any broker is authorized to encourage bidders

Answer 1

B: the broker violated the relationship

Step-by-step explanation:

When we hire a broker there is an understandable agency relationship. Where the broker is a kind of agent and he has to work according to the demands of principal.

In the given case also, the seller - Joe Needy hires a broker for selling the house for $40,000. Thus, when the broker sells intentionally for a value less than $40,000 by asking the desired customer for this proposal then, the broker is said to violate the relationship he has with the seller.

Because telling facts of the deal is important, but telling the weak points in such deals is a mere betrayal.