Which of the Following Statements Is FALSE

question 26

Multiple Choice

Which of the following statements is FALSE?

• A)New SEC rules require firms to report option grants within two days of the grant date,which may help prevent further abuses.
• B)Studies have found evidence that the practice of timing the release of information to maximize the value of CEO stock options is widespread.
• C)Managers have an incentive to manipulate the release of financial forecasts so that good news comes out before options are granted and bad news is delayed until after the options are granted.
• D)The factor contributing most to the climb in CEO total compensation for the 1990s was the sharp increase in the value of stock and options granted each year.

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Definitions:

Wagering Contracts

Agreements where the parties stand to win or lose based on the outcome of an uncertain event, often considered unenforceable due to their speculative nature.

Warranty

A guarantee given to the purchaser of an item by the seller, promising repair or replacement in case of defects within a certain period of time.

Codicil

A supplement or addition made to alter, explain, or otherwise modify a will, without revoking it entirely.

Working Sprinkler System

A fully operational fire suppression system installed in buildings that activates automatically in response to detectable signs of fire, such as heat or smoke.