Which of the Following Is the Effect of the Business

question 35

Multiple Choice

Which of the following is the effect of the business judgment rule regarding the liability of officers and directors?

• A) Courts will not substitute their judgment for that of the board or an officer acting in good faith with due care.
• B) Officers and directors will never have liability for their decisions relating to the corporation.
• C) Officers and directors may have liability for bad faith decisions,but cannot be liable for failure to act.
• D) Directors and officers will not be held liable for conduct that is only negligent.

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Definitions:

Insufficient Justification Effect

A phenomenon in psychology where individuals change their attitudes or beliefs due to the realization that their actions cannot be justified by the external rewards or punishments alone.

Cognitive Dissonance Theory

A theory which suggests that we experience discomfort or dissonance when our beliefs, values, or behaviors are in conflict, leading us to change one to reduce the dissonance.

Introductory Psychology

The branch of psychology that is designed as an entry point for students, covering fundamental concepts, theories, and research methods in psychology.

Prerequisite

A requirement that must be fulfilled before a certain action can be taken or a more advanced stage can be reached.