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David is the president of Lotus Corporation (Lotus). David decided to have Lotus manufacture large, non-fuel-efficient sport utility vehicles (SUVs) just before gasoline prices rose
David is the president of Lotus Corporation (Lotus). David decided to have Lotus manufacture large, non-fuel-efficient sport utility vehicles (SUVs) just before gasoline prices rose dramatically. As a result, Lotus lost a significant percentage of its automotive market share. Lotus shareholders want to sue David for his bad decision that cost them millions of dollars. However, David made a reasonable investigation before making this decision, he had a rational basis for it, and he had no conflicts of interest regarding this decision. Which of the following is the most likely outcome if the shareholders file a lawsuit against David? O David will be held liable under the ultra vires rule. O David will not be held liable, since corporate presidents have absolute immunity from liability for decisions they made in the ordinary course of business. O David will be held liable under the vicarious liability rule. CO David will not be held liable under the business judgment rule
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