Negligent misrepresentation occurs when:

Negligent misrepresentation occurs in situations where an agent provides false information that they should have known was inaccurate. This concept is rooted in the expectation that professionals, like real estate agents, exercise a degree of care and diligence in verifying the accuracy of the information they share. When an agent states something as a fact, they are responsible for ensuring that the information is correct, particularly when it pertains to material facts that could influence a real estate transaction.

In this case, choosing the option that states the agent made statements they should have known were false emphasizes the lack of due diligence or care, which distinguishes negligent misrepresentation from fraudulent misrepresentation, where the false statements are made with knowledge of their inaccuracy and intent to deceive. The greater expectation of knowledge and responsibility placed on professionals like real estate agents is what makes this scenario fit the definition of negligent misrepresentation.