Unscrupulous managers have learned ways to manipulate stock options and undermine their benefits to stockholders. Discuss some provisions that could be built into the process to curb such practices
Such problems are best attacked directly by requiring the issue of stock options to management to satisfy provisions such as the following:
a . That exercise of those stock options should not be permitted for some substantial period of time, say five years, after they are initially offered;
b. That the stock options be performance-based;
c. That any such grant of options to management be subject to approval by vote of the firm's stockholders; and
d. That the sale of such shares by top management be made public promptly.
You might also like to view...
Refer to Table 4-3. The table above lists the marginal cost of cowboy hats by The Waco Kid, a firm that specializes in producing western wear. If the market price of cowboy hats is $50, producer surplus is
A) $0. B) $4. C) $62. D) $138.
The marginal propensity to consume is the slope of the consumption function
Indicate whether the statement is true or false
Which of the following would tend to decrease the demand for carpenters?
a. An increase in the wages of carpenters. b. An increase in the price of houses. c. A decrease in the demand for houses. d. An increase in the supply of carpenters.
From the 1970s through the 1990s, the relative price of a college education has increased greatly. During the same time period, college enrollment has also increased. This evidence suggests that during this time period
A) the demand curve for a college education has shifted leftward. B) the demand curve for a college education has shifted rightward. C) the supply curve for a college education has shifted leftward. D) the supply curve for a college education has shifted rightward.