Choice "C" is correct. Under the business judgment rule, a director is protected from liability for decisions made on behalf of the corporation if the director acts in good faith and in a manner that the director believes is in the best interest of the corporation, exercising the care that a reasonably prudent person would exercise in a similar position. The action must also ostensibly be within the power of the corporation to undertake and ostensibly within the authority of management to make.
Choice "d" is incorrect. A director will not be protected under the business judgment rule if he knowingly causes the corporation to undertake action that is not within the power of the corporation to take and not within the authority of management.
Choices "b" and "a" are incorrect. The business judgment rule protects directors; it is not applicable to the shareholders (except perhaps in the case of a closely-held corporation being run by the shareholders).