Which of the Following Statements Regarding Employee Stock Options (ESO)is

question 20

Multiple Choice

Which of the following statements regarding employee stock options (ESO) is false?

• A) Most ESOs are at the money when issued.
• B) They are typically issued with only a few months until expiration.
• C) Many firms do not let employees exercise their options until a vesting period has passed.
• D) ESOs are most valuable when the price of the underlying asset is well above the stock price.

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Definitions:

Venture

A business enterprise involving risk in expectation of gain.

Co-Owner

An individual or entity that shares ownership of an asset, property, or business with one or more parties.

Venture Capitalists

Investors who provide capital to startups and small businesses with long-term growth potential in exchange for equity, or partial ownership of the company.

Angel Investors

Wealthy individuals who provide capital for start-ups or entrepreneurs in exchange for ownership equity or convertible debt.