Aharon exercises 10 stock options awarded several years ago. The following information pertains to the options: (1) each option gives the employee the right to buy 10 shares, (2) the market price on the grant date was $7, (3) the strike price is $10, and (4) the market price on the exercise date was $15. How much will it cost Aharon to purchase the options on the exercise date?
A) $90.
B) $500.
C) $700.
D) $1,000.

Question

Quizplus · Accepted Answer

$1,000 (10 options × 10 shares × $10 exercise price).

Aharon Exercises 10 Stock Options Awarded Several Years Ago