Most States, as Well as the Revised Act, Hold That

question 78

Multiple Choice

Most states, as well as the Revised Act, hold that the test for the duty of diligence requires a director or officer to discharge corporate duties:

• A) in good faith.
• B) with a high degree of care.
• C) without a conflict of interest.
• D) through a named attorney or legal firm.
• E) All of these.

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Definitions:

Market Price

The present rate at which a service or asset is available for purchase or sale in the market.

Perfectly Competitive

A market structure where many firms offer a homogeneous product, there are no barriers to entry or exit, and every company is a price taker.

Total Cost

The total expense of manufacturing, comprising both constant and fluctuating costs.

Market Price

The cost at which a product or service is made available in the market, dictated by the forces of supply and demand.