A publicly traded Canadian corporation provides employees with one year of continuous service and the opportunity to place 6% of their pre-tax income in a plan that may be invested in the company's stock.Furthermore,the company matches the shares by 50% up to a limit of 4% of the employees' pre-tax income.From the perspective of the employee,what are the potential drawbacks of participating in this program?

Question

Quizplus · Accepted Answer

There is a risk involved in investing in company stock, as there is a potential for the company to perform poorly and for the employee's job and savings to be at risk. The other potential drawbacks mentioned in options A, B, and C are not applicable in this case, as administrative costs are not mentioned, it is not stated that it is difficult to determine the performance of the stock, and there is no indication that the plan poses a significant tax burden.

A Publicly Traded Canadian Corporation Provides Employees with One Year