The __________ Requires That Officers and Directors Not Take Personal

question 7

Multiple Choice

The __________ requires that officers and directors not take personal advantage of a desirable business investment that rightfully belongs to the corporation.

• A) right of first refusal
• B) corporate opportunity doctrine
• C) line of business test
• D) expectancy test

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Definitions:

Cash Flow

Cash Flow is the total amount of money being transferred into and out of a business, especially as affecting liquidity. It is often considered in terms of net cash flow, which is income minus expenses.

Project

A temporary endeavor designed to produce a unique product, service, or result with specific objectives.

WACC

The Weighted Average Cost of Capital is determined by calculating a firm's capital cost, with proportional weights assigned to each category of capital.

NPV

Net Present Value, a calculation used to assess the profitability of an investment by discounting future cash flows to their present value.