Which of the Following Statements Is Correct Regarding Stock Option

question 42

Multiple Choice

Which of the following statements is correct regarding stock option plans?

• A) They are offered only to top-level executives and members of the board of directors.
• B) If the stock price increases, employees are likely to exercise their option to purchase the stock.
• C) The company holds the stock for the benefit of the employees.
• D) Stock options are provided as a retirement benefit.

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Definitions:

Overconsumption

The excessive use of resources or consumption of goods beyond what is sustainable or environmentally sound.

Economic Growth

An increase in a country's output of goods and services over time, often measured by changes in real GDP.

Allocative Inefficiency

A situation where resources are not distributed optimally, resulting in lost potential for producing welfare or value.

Marginal Cost

The cost incurred by producing one more unit of a good or service.