The Advantages of Employee Stock Ownership Plans Include All of the Following

question 13

Multiple Choice

The advantages of employee stock ownership plans include all of the following EXCEPT that

• A)employers are able to provide retirement benefits to employees at a relatively low cost.
• B)employees' pensions are less vulnerable due to diversification.
• C)employee stock ownership plans can increase employees' pride of ownership.
• D)employee stock ownership plans can provide an incentive for employees to increase productivity.

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Definitions:

Investment Banker

A financial professional who advises companies on capital raising, mergers, acquisitions, and other major corporate transactions.

Agency Problems

Agency Problems arise when there's a conflict of interest between the principals (owners or shareholders) and agents (managers or executives) of a company, leading to potentially suboptimal decision-making.

Financial Manager

An individual responsible for overseeing and managing a company's finances, including planning, organizing, controlling, and monitoring financial resources.

Expected Cash Flows

Projections of cash revenues and expenditures that a company anticipates receiving or paying out, crucial for budgeting and financial planning.