Fact Pattern 35-1

question 32

Multiple Choice

Fact Pattern 35-1
Ray is a shareholder of Small Biz Company (SBC) . When the direc?tors fail to undertake an action to redress a wrong suffered by SBC, Ray files a suit on the firm's behalf.
-Refer to Fact Pattern 35-1. Ray's suit is a shareholder's

• A) business-judgment rule suit.
• B) derivative suit.
• C) duty-of-care suit.
• D) duty-of-loyalty suit.

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Definitions:

Percentage Cost

This refers to the cost expressed as a percentage of the total amount or value involved.

Production Output

The total quantity of goods and services produced in a given time period by a firm or country.

Cash Sales Policy

A cash sales policy is a business approach where transactions are conducted strictly on a cash basis, without offering credit to customers.

Discount Period

The discount period is the time frame in which a payment can be made at a discounted rate from the regular price or before it becomes due.