Implied authority is best described as:

Implied authority is best understood as the form of indirect authority that arises from the actions, conduct, or perceptions regarding an agent's role. It is not explicitly stated or documented but is inferred from the relationship between the agent and the principal, as well as the practices and norms within the industry. This understanding hinges on the notion that when an agent performs duties or engages in activities that are typical for their position, third parties may reasonably assume that the agent has the authority to act on behalf of the principal.

For instance, if an insurance adjuster starts negotiations with a claimant or processes claims in a manner customary for their role, stakeholders might perceive that this adjuster has the authority to make binding decisions. Thus, implied authority plays a critical role in facilitating business transactions by ensuring that there is a level of trust and expectation built around the actions of the agent.

The other choices do not align with this definition. Authority that must be explicitly stated refers to express authority, while saying that authority is always limited in scope does not capture the essence of implied authority. Legal authority given to all agents suggests a wide-reaching authority that does not necessarily pertain to the specific, contextual understanding of implied authority.