Which of the Following Statements Regarding the Granting of Stock

question 22

Multiple Choice

Which of the following statements regarding the granting of stock options is FALSE?

• A)New SEC rules require firms to report option grants within two days of the grant date,which may help prevent further abuses.
• B)Studies have found evidence that the practice of timing the release of information to maximize the value of CEO stock options is widespread.
• C)Managers have an incentive to manipulate the release of financial forecasts so that good news comes out before options are granted and bad news is delayed until after the options are granted.
• D)The factor contributing most to the climb in CEO total compensation for the 1990s was the sharp increase in the value of stock and options granted each year.

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Definitions:

Secondary Data

Data that was collected by someone else or for a purpose other than the current research project.

Independent Variable

In an experiment, the variable that is manipulated or changed to observe its effects on the dependent variable.

Control Group

In an experiment, the group of participants that does not receive the experimental treatment, used as a baseline to measure how the other tested groups do.

Experimental Group

The subset of participants in an experiment who are exposed to the independent variable.