Stock options as a form of payment are designed to
A) evade the equal-pay-for-equal-work provisions of the federal antidiscrimination law.
B) boost the overall earnings of minimum-wage workers.
C) offset monopsony.
D) address the principal-agent problem.

Question

Quizplus · Accepted Answer

Stock options are often used to align the interests of the principal (shareholders) and the agent (executives/employees) by tying compensation to company performance. This can help address the principal-agent problem, where executives/employees may prioritize their own self-interest over the interests of shareholders.

Stock Options as a Form of Payment Are Designed to