By Rewarding Executives with Large Option Positions,corporations

question 10

Multiple Choice

By rewarding executives with large option positions,corporations:

• A) cause the executives to hold highly undiversified portfolios.
• B) put the firm in a risky position to pay off the options.
• C) cause the value of the stock to fall because the options are theft.
• D) are really valueless because most options are never exercised.
• E) None of these.

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Definitions:

Detail Offered

The specific information provided to potential buyers about a product or service to aid their decision-making process.

Targeted Customers

Specific segments of the market identified as potential purchasers or users of a company's products or services.

Perceptual Vigilance

The tendency of individuals to notice and give preferential treatment to stimuli that are relevant to their current needs or interests.

Stimulus Organization

The process by which individuals perceive and organize sensory inputs into meaningful patterns or systems.