What questions should an employee ask before accepting options as part of or instead of a salary?
What will be an ideal response?
Most of the time when employees receive the options (call options) the strike price is set at the current market price of the stock, and so the options are at the money. If the price of the company's stock increases, the value of the options will also rise and the rise can be dramatic. However, this is not unlike buying lottery tickets; there may be a high payoff but it may not come for years. And, if the company goes broke or you lose your job the options may become worthless (some companies either do not permit employees to sell the options or may require that the employees stay with the firm in order to exercise them).
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To avoid multiple counting in national income accounts, ________.
A. primary, intermediate, and final goods and services should be counted B. both final and intermediate goods and services should be counted C. only final goods and services should be counted D. intermediate goods and services should be counted
If the marginal propensity to save is 0.25, then a $10,000 decrease in disposable income will
A) increase consumption by $7,500. B) decrease consumption by $2,500. C) increase consumption by $2,500. D) decrease consumption by $7,500.
A group of firms that collude to limit competition is called a(n):
a. conglomerate. b. oligopoly. c. cartel. d. kinked demand. e. market concentration.
Arnold's nominal wage increased by 3%, and the prices of goods that Arnold buys increased by 5%. Arnold's real wage has
A. increased. B. decreased. C. remained constant. D. changed by 8%, but the direction of the change is ambiguous.