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Suzanne Received 20 ISOs (Each Option Gives

question 119

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Suzanne received 20 ISOs (each option gives her the right to purchase 20 shares of stock for $12 per share)at the time she started working, when the stock price was $14 per share. Three years later, when the share price was $23 per share, she exercised all of her options. How much cash will Suzanne need on the exercise date of the stock options?


Definitions:

Foot-In-The-Door

A compliance technique where a small initial request is made which is easy to agree to, followed by a larger request.

Fundamental Attribution Error

The inclination to give too much importance to individual traits and overlook the influence of circumstances when evaluating the actions of others.

Situational Attributions

The process of explaining one's own or other people's behavior as the result of external factors, such as the context or the situation.

Cognitive Dissonance

A psychological concept referring to the mental discomfort experienced by a person who holds two or more contradictory beliefs, ideas, or values at the same time.

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