GCC Corporation Is Planning to Issue Options to Its Key

question 19

Multiple Choice

GCC Corporation is planning to issue options to its key employees,and it is now discussing the terms to be set on those options.Which circumstance would decrease the value of the options,other things held constant?

• A)GCC's stock price becomes more risky (higher variance).
• B)The exercise price of the option is increased.
• C)The life of the option is increased, i.e., the time until it expires is lengthened.
• D)The government takes actions that increase the risk-free rate.

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Definitions:

Change Management

The approach to transitioning individuals, teams, and organizations to a desired future state.

Political Support

The backing or endorsement by political figures, parties, or entities, often crucial for gaining legitimation, resources, or favorable conditions.

Transition Management

The process of guiding individuals, teams, or organizations through a series of changes, from one state to another to achieve desired outcomes.

Status Quo

The existing state or condition of affairs, often used in the context of maintaining current situations without change.