Etta Is a Director of Fab Stuff Corporation

question 17

Multiple Choice

Etta is a director of Fab Stuff Corporation.Without informing Fab,Etta goes into business with GR8 Things,Inc.,in competition with Fab.Etta is liable for breach of 

• A) ​the business judgment rule. 
• B) ​the duty of loyalty. 
• C) ​no duty or rule 
• D) ​the duty of care.

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Definitions:

NPV

The calculation used to find the current value of future cash flows minus initial investments, which helps in evaluating the feasibility of investments or projects.

Credit Policy

The guidelines a company follows to determine creditworthiness, terms of credit, and how to collect owed money, affecting its trade credit and financing approaches.

Accounts Receivable Approach

A method used to estimate the value of a firm's accounts receivable and gauge the potential for uncollectible invoices.

Net Present Value

A financial metric that calculates the present value of all cash flows associated with a project or investment, considering both inflows and outflows, to assess its profitability.