A Major Problem with ESOPs Is That

question 98

Multiple Choice

A major problem with ESOPs is that

• A) they carry a significant risk for employees.
• B) employees are not allowed to participate in votes by shareholders.
• C) the stocks within the trust are too widely diversified to earn high returns.
• D) any earnings from the trust holdings are taxed at an extremely high rate.
• E) they result in reduced profitability for the employees.

---

Definitions:

Political

Pertaining to the governance, policies, and affairs of a state or organization, often involving power and resource distribution.

Identity Development

The process through which an individual forms a distinct sense of self and personal values over the course of life.

Intimate Relationships

Deep, close connections between individuals that involve love, affection, trust, and deep knowledge of each other.

Gender

The range of characteristics pertaining to, and differentiating between, masculinity and femininity, including social roles, behaviors, and identities beyond biological sex.