Which of the Following Is a Reason for ESOPs' Popularity

question 117

Multiple Choice

Which of the following is a reason for ESOPs' popularity?

• A) ESOPs provide tax advantages to employers.
• B) ESOPs provide very high risk-free retirement income.
• C) Employees can use ESOPs to buy their company during financial crises.
• D) ESOPs must invest at least 51 percent of its assets in the company's own stocks.
• E) The employees are provided with many more stocks than they actually own.

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Definitions:

Savings Account

A bank account that earns interest and is typically used for holding money that is not intended for daily expenses.

Accumulated Amount

The total sum including the principal and the compounded interest over a period.

End-Of-Quarter Payments

Payments that are made at the conclusion of a fiscal quarter, often related to financial obligations such as loans or leases.

Annuity

A fiscal product designed to disburse a static sequence of payments to someone, chiefly utilized as a means for generating income during retirement.