The Date on Which to Measure the Compensation Element in a Stock

question 43

Multiple Choice

The date on which to measure the compensation element in a stock option granted to a corporate employee ordinarily is the date on which the employee

• A) is granted the option.
• B) has performed all conditions precedent to exercising the option.
• C) may first exercise the option.
• D) the option.

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Definitions:

Uniform Probability Distribution

A continuous probability distribution for which the probability that the random variable will assume a value in any interval is the same for each interval of equal length.

Continuous Random Variable

A Continuous Random Variable is a variable that can take an infinite number of values within a given range.

Probability Density Function

A function that describes the relative likelihood for a continuous random variable to occur at a point in the observation space.

Continuous Random Variable

A variable that can take an infinite number of real values within a specific range.