Which of the Following Statements Best Describes the "Business Judgment

question 9

Multiple Choice

Which of the following statements best describes the "business judgment rule"?

• A)The courts will never find that a business decision by a director or officer is a breach of the duty of care.
• B)Business decisions are presumed not to be a breach of duty,unless the court does not understand the business rationale for the decision.
• C)Directors and officers should always exercise their best business judgment in making decisions relating to the corporation.
• D)The courts will substitute their business judgment for that of directors and officers if doing so makes sense to them.
• E)Business decisions are presumed not to be a breach of duty so long as they fall within the range of reasonable business alternatives that were available and the process for making the business decision was reasonable.

---

Definitions:

Environmental Impacts

The effect of human activities and natural events on the natural environment, including changes to air, water, and land.

Sustainability

The practice of maintaining processes or systems in a way that does not deplete natural resources, ensuring long-term ecological balance.

Competitive Advantage

The attributes or conditions that allow a company to produce goods or services better or more cheaply than its competitors.

Environmental Costs

Expenses associated with the negative impact of a company's operations on the natural environment, including waste disposal, pollution control, and resource depletion.