ABC Corporation Suffered Damages When a Supplier Failed to Deliver

question 124

Multiple Choice

ABC Corporation suffered damages when a supplier failed to deliver as agreed. The president of ABC did not institute suit as Garrett, a major shareholder, believed was proper. Garrett complained to the board of directors, but they refused to do anything. Which of the following is an option to Garrett in regard to a lawsuit against the supplier?

• A) A shareholder's derivative suit
• B) A shareholder's direct suit
• C) A consolidation suit
• D) A mandated suit
• E) None of these because as a shareholder, Garrett has no right to insist on litigation

---

Definitions:

Perfectly Competitive

A market scenario characterized by an infinite number of buyers and sellers, freedom of entry and exit, and a product that is homogenous across all suppliers.

Constant-Cost Industry

An industry where the costs of production do not change as the industry's output changes.

Long-Run Equilibrium

A state in economic theory where all factors of production are fully adjustable, allowing for optimal resource allocation and full competition.

Increasing-Cost Industry

An industry in which production costs increase as the entire market expands production, often due to finite resources.