Ask Question, Ask an Expert


Ask Basic Finance Expert

It is possible for employee stock options to have a value greater than $0 even if the firm's stock price falls below the stock option's exercise price because:

a. the firm can issue additional shares at a premium

b. employees can adjust the exercise price if necessary

c. employees can exercise the option if the market price of the stock should rise above the exercise price in the future

d. federal law prohibits ESOP plans from downside risk

e. ESOP plans obligate employees to exercise the stock option should the firm's stock price fall below the option's exercise price.

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M942643

Have any Question? 

Related Questions in Basic Finance

Assignment questions-a list and briefly describe the three

Assignment Questions- A. List and briefly describe the three general areas of responsibility for a chief financial officer (CFO) of a selected non-financial company which is listed on Australian Stock Exchange (ASX). Exp ...

1 the price of ervin corp stock will either be 60 or 80 at

1) The price of Ervin Corp. stock will either be $60 or $80 at the end of the year. Call options are available with one year until expiration. T-bills currently yield 3.26 %. Suppose the current price of Ervin stock is $ ...

Rtio analysisextraordinary items and ratio analysis

Ratio Analysis "Extraordinary Items and Ratio Analysis" Please respond to the following: • Choose at least two items or events that you would consider to be extraordinary to a company. Propose the manner in which you wou ...

Comprehensive problemuse what you have learned about the

Comprehensive Problem Use what you have learned about the time value of money to analyze each of the following decisions: Decision #1: Which set of Cash Flows is worth more now? Assume that your grandmother wants to give ...

Examination1 if purchasing power parity applied to big

Examination 1. If purchasing power parity applied to Big Macs, and a Big Mac cost $2.50 in the United States while the British pound cost $1.50 and €0.90 euros could be obtained for $1.00 a) how much would the Big Mac co ...

Assume that the fed is targeting an interest rate and the

Assume that the Fed is targeting an interest rate and the demand for money increases. Explain why the money supply will increase.

1 facebook inc is an unlevered firm from its existing web

1. Facebook, Inc., is an unlevered firm. From its existing web based operations, it is expected to generate annual earnings before taxes of $20 million next year. It is expected to grow at a rate of 7% for the next three ...

Business financequestion oneif you invest 10525 today at an

BUSINESS FINANCE QUESTION ONE If you invest $10,525 today at an interest rate of 7.35% compounded daily, how much money will you have on your saving account in 15 years? QUESTION 2 Stephen plans to purchase a car in 5 ye ...

1 choose a country of interest to you go to the executive

1. Choose a country of interest to you. Go to the Executive Planet website ( or another website with cross-cultural comparisons and analyze the country in terms of the following cultural dimension ...

Bills boards has 202 million shares of common stock

Bill's Boards has 20.2 million shares of common stock outstanding, 4.2 million shares of preferred stock outstanding, and 22.00 thousand bonds. If the common shares are selling for $30.20 per share, the preferred share a ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

A cola-dispensing machine is set to dispense 9 ounces of

A cola-dispensing machine is set to dispense 9 ounces of cola per cup, with a standard deviation of 1.0 ounce. The manuf

What is marketingbullwhat is marketing think back to your

What is Marketing? • "What is marketing"? Think back to your impressions before you started this class versus how you

Question -your client david smith runs a small it

QUESTION - Your client, David Smith runs a small IT consulting business specialising in computer software and techno

Inspection of a random sample of 22 aircraft showed that 15

Inspection of a random sample of 22 aircraft showed that 15 needed repairs to fix a wiring problem that might compromise

Effective hrmquestionhow can an effective hrm system help

Effective HRM Question How can an effective HRM system help facilitate the achievement of an organization's strate