Explain Why Only In-The-Money Options Need Be Considered in the Diluted

question 70

Essay

Explain why only in-the-money options need be considered in the diluted EPS calculations.

---

Definitions:

Adrenal Cortex

The outer layer of the adrenal glands that produces steroid hormones such as cortisol and aldosterone, which regulate metabolism and blood pressure.

Hormones

Chemical messengers produced by the endocrine glands in the body, transported in the bloodstream to target organs to regulate physiology and behavior.

Endocrine System

The body system that helps regulate metabolic activities; consists of ductless glands and tissues that secrete hormones.

Nervous System

The system composed of neurons and their extensions that is responsible for sending signals throughout the body.