Which of the Following Is/are True Concerning an Employee Stock

question 192

Multiple Choice

Which of the following is/are true concerning an employee stock options' time value element?

• A)The time value element results from the possibility of increases in the market price of the stock during the exercise period.
• B)Time value is larger the longer the exercise period and the more volatile the market price of the stock.
• C)A stock option whose exercise price exceeds the current market price has economic value because of the possibility that the market price will exceed the exercise price on the exercise date.
• D)A stock option whose exercise price has zero intrinsic value has economic value because of the possibility that on the exercise date there would be positive intrinsic value.
• E)all of the above