nds for training c) If top management has stock options that become valuable at a particular price, they will be incentivized to buy and sell stocks d) This will help the managers and stockholders learn to
nds for training c) If top management has stock options that become valuable at a particular price, they will be incentivized to buy and sell stocks d) This will help the managers and stockholders learn to
Foundations of Business (MindTap Course List)
6th Edition
ISBN:9781337386920
Author:William M. Pride, Robert J. Hughes, Jack R. Kapoor
Publisher:William M. Pride, Robert J. Hughes, Jack R. Kapoor
Chapter15: Using Management And Accounting Information
Section: Chapter Questions
Problem 3DQ
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Question
123) How does awarding managers stock options help align the goals of managers and stockholders?
a) If top management has stock options that become valuable at a particular price (higher than the prevailing markets price), management will b incentivized to improve company performance so the option can be exercised at the higher price
b) Stock options guide managers in allocating funds for training
c) If top management has stock options that become valuable at a particular price, they will be incentivized to buy and sell stocks
d) This will help the managers and stockholders learn to work with each other as the managers will look to stockholders for advice on stock handling
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