Bad Brad Received 20 NQOs (Each Option Gives Him the Right

question 53

Multiple Choice

Bad Brad received 20 NQOs (each option gives him the right to purchase 30 shares of stock for $12 per share) from his employer. At the time he started working, the stock price was $11 per share. Now that the share price is $25 per share, he exercises all of the options. Two years later Bad Brad sells the stock for $27 per share. What is Bad Brad's basis in his stock for purposes of calculating the gain or loss at the time of the sale?

• A)$7,200
• B)$7,800
• C)$15,000
• D)$16,200

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Definitions:

Command-and-control

A traditional management style that relies on hierarchical structure, strict discipline, and clear orders.

Team Members

Individuals who are part of a group collaboratively working towards a common goal, sharing responsibilities and tasks.

Autocratic Leadership

A leadership style where the leader makes decisions unilaterally without consulting others, often exerting high levels of control over team members.

Micromanages

The practice of excessively controlling or managing all aspects of work or employees’ performance, often to an unnecessary or counterproductive degree.