Final answer:
Sally is the principal as she owns and runs the apple cider stands, and her brothers are her agents because they are hired to work at the stands and follow her instructions. The grocery store is only a supplier and not involved in the business operations.
Step-by-step explanation:
In the scenario described, Sally is the principal because she owns the chain of neighborhood apple cider stands and makes the decisions about how to operate the business. Her brothers, whom she hires to staff the stands, act on her behalf and follow her instructions to sell the cider; thus, they are considered the agents. The grocery store from which Sally purchases apples is simply the supplier and does not have a direct role in the management or operation of Sally's business, so it is neither a principal nor an agent in this scenario. Therefore, the correct answer to this question is: a. Sally is the principal and her brothers are the agents.