Which of the Following Statements in Relation to Modifications to the Terms

question 18

Multiple Choice

Which of the following statements in relation to modifications to the terms and conditions on which equity instruments were granted as part of an employee share scheme is correct?

• A) a reduction in the exercise price of options will reduce the fair value of the share options
• B) a reduction in a performance hurdle relating to profitability targets will reduce the fair value of the options
• C) a shortening of the vesting period will increase the fair value of the share options.
• D) an increase in the number of equity instruments granted is not an example of a modification

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Definitions:

In-Plant Inventory

Refers to the stock of raw materials, work-in-progress, and finished goods that are kept within a manufacturing plant or facility.

Just-In-Time Partnerships

Collaborations between companies that focus on producing or delivering goods only as they are needed, to reduce inventory costs and increase efficiency.

Large Lot Sizes

Refers to the practice of producing or purchasing goods in large quantities, typically to achieve economies of scale but potentially leading to increased inventory costs.