A Share Option Plan Will Be Defined as Compensatory If

question 117

Multiple Choice

A share option plan will be defined as compensatory if it has which one of the following characteristics?

• A) The discount from market price for the stock option is greater than either what would be reasonable in an offer of stock to shareholders or others or the per-share amount of issuance costs avoided by not issuing the stock to the public.
• B) Employees have 31 days or less from the date the purchase price is set to decide whether or not to enroll in the plan.
• C) Almost all full-time employees are able to participate in the plan.
• D) The purchase price is based solely on the market price of the stock on the purchase date.

Understand how experience curves vary across different industries.

Relate market share and experience curve to return on investment.

Analyze how cumulative output influences unit costs in relation to the experience curve.

Apply the concept of the experience curve to improve a firm’s competitive position through various methods.

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Definitions:

List Price

The manufacturer's suggested retail price of a product before any discounts or allowances.

Purchases Discount

A reduction in the amount payable by a buyer to a seller, if the payment on the purchase is made within a specified period.

Chart Of Accounts

A list of the accounts in the ledger.

Merchandising Business

A company that purchases goods wholesale and resells them at retail, making profit from the markup.