Fiduciary relationship is a relationship based on __________.A.contractB.trustC.blood relationshipD.money
Question
Fiduciary relationship is a relationship based on __________.
A. contract
B. trust
C. blood relationship
D. money
Solution
Final Answer
The correct answer is B. trust.
Explanation
A fiduciary relationship is a legal or ethical relationship of trust between two or more parties. In this type of relationship, one party, known as the fiduciary, is entrusted to act in the best interest of another party, known as the principal. This relationship is often established through various agreements, but the essence lies in the trust placed by the principal in the fiduciary to act responsibly and with integrity. This trust obligates the fiduciary to put the principal's interests ahead of their own and to be honest and transparent in their dealings. Consequently, while contracts, blood relationships, and money can play roles in various relationships, it is fundamentally the element of trust that defines a fiduciary relationship.
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