Problems with stock options include all EXCEPT:
A) A CEO might forego increasing dividends to use the cash to try and increase the stock price.
B) CEOs accept riskier projects because that usually causes the stock price to increase.
C) Option payoffs are closely related to the performance of the overall stock market.
D) CEOs will work hard to increase the stock price when they receive stock options.
E) There are no problems with using stock options to incent CEOs.
Correct Answer:
Verified
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