Stock options give the people granted the option the opportunity to
A) purchase stock at a later date at a price established now.
B) share directly in the profits of the firm.
C) purchase company stock anytime at a specific discount.
D) purchase stock of any company through online trading.

Question

Quizplus · Accepted Answer

Stock options allow the option holder to purchase stock at a specific price (known as the strike price) at a later date, which is typically set at the time the option is granted. This gives them the opportunity to benefit from any increase in the stock's value above the strike price. Option holders do not directly share in the profits of the firm, nor do they get a discount on company stock (unless specified as part of the option terms). Online trading is also not related to stock options.

Stock Options Give the People Granted the Option the Opportunity