Alyssa, the Financial Officer at Doone & Smithfield, Encourages the Human

question 43

Multiple Choice

Alyssa, the financial officer at Doone & Smithfield, encourages the human resource manager to consider using stock options as incentive pay for all employees. The human resource manager cautions that employees could become upset if the options don't turn out to be as valuable as cash. Which statement supports this concern?

• A) Stock options are not profitable to employees.
• B) Option owners must exercise the options, no matter what the market price.
• C) Employees may not purchase their employer's stock.
• D) Offering stock options discourages employees from thinking like owners.
• E) Stock prices in the market may fall below the exercise price of the options.

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Definitions:

Intent To Deceive

A deliberate act or condition of willfully misleading someone or concealing the truth to gain an unfair advantage.

Undue Influence

Excessive pressure or manipulation exerted by one individual over another to the extent it overcomes the victim's free will, often discussed in contexts of contracts and wills.

Nondisclosure

An agreement or principle that prevents the sharing of confidential or proprietary information with unauthorized parties.

False Assertion

The act of declaring something that is untrue, often with the intention to deceive or mislead.