Asked by Connor Culhane on May 10, 2024
Verified
Which of the following statements is true of stock options?
A) Employees who are given stock options are legally bound to sign a noncompete clause.
B) The stock-option price for employees is higher than the selling price of the stock when the option is issued.
C) They give employees the right to purchase a certain number of shares of stock at a given price.
D) They give employees the opportunity to be part of the company's inventory management.
Stock Options
Financial incentives given to employees, granting them the right to buy the company's stock at a set price within a certain period.
Noncompete Clause
A contract provision that restricts an employee from working with competing firms or starting a similar business for a specified period after leaving the company.
- Acquire knowledge on how stock options, job embeddedness, and realistic job previews contribute to the retention of employees.
Verified Answer
GS
ganesh sitalMay 14, 2024
Final Answer :
C
Explanation :
Stock options provide employees with the right to buy a specific number of shares of the company's stock at a predetermined price, offering a potential financial benefit if the stock's market price exceeds the option price.
Learning Objectives
- Acquire knowledge on how stock options, job embeddedness, and realistic job previews contribute to the retention of employees.