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Week 5 Review - Corporate Governance Flashcards | StudBud

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Who elects the Board of Directors?

How does good corporate governance impact a company?

Week 5 Review - Corporate Governance

10 terms·StudBud Administration·71 plays

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Questions 10

Answers

1
How does good corporate governance impact a company?
Always guarantees profits
No effect on operations
Increases cost of capital
Can lower cost of capital
2
Who elects the Board of Directors?
Shareholders
Creditors
Employees
Government officials
3
What is limited liability in corporate context?
Unlimited personal responsibility
Partial ownership
Owners' personal assets protected
Full liability for debts
4
What does corporate governance refer to?
How a corporation is directed and controlled
Marketing strategies
Employee management
Financial reporting
5
What is the business judgment rule?
Rule against insider trading
Requirement for unanimous board decisions
Strict liability for decisions
Immunity for good faith business decisions
6
What is statutory law?
Common law
Case law
Body of law enacted by legislative bodies
Administrative regulations
7
What is the purpose of corporate governance?
Avoid all business risks
Maximize short-term profits
Eliminate competition
Promote accountability and trust
8
What is an ordinance in legal terms?
Federal statute
Supreme Court decision
State constitution
Law passed by local governing unit
9
What is a fiduciary duty in corporate law?
Shareholder agreement
Tax obligation
Legal responsibility to act in best interest of another
Employment contract
10
What is a corporation in legal terms?
An unincorporated association
A sole proprietorship
A partnership
A legal entity created by state law