The Value of the Options Awarded Executives Is Much Less

question 11

Multiple Choice

The value of the options awarded executives is much less than face value to the executives because:

• A)the value to the executive depends on the stock price being greater than the exercise price.
• B)the options must be held beyond the freeze-out period.
• C)a highly undiversified portfolio can have a large drop in value with high variance stocks.
• D)All of the above.
• E)None of the above.

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Definitions:

Exact Amount

Specifies a precise figure or quantity, leaving no room for deviation or approximation.

Force Majeure Clause

A contractual provision that frees all parties from liability or obligation when an extraordinary event or circumstance beyond their control occurs, preventing them from fulfilling their obligations.

Declaration Of War

A formal statement issued by a national government indicating that a state of war exists between it and another nation.

United Nations

An international organization formed in 1945 to promote peace, security, and cooperation among the world's nations through diplomacy and dialogue.