Martin works for Epic Electronics, a sophisticated electronic equipment company. Martin is happy to see that the value of company stock has reached $53 per share, because certain employees (including himself) have the opportunity to buy a given number of shares of its stock for $25 per share for the next year regardless of how high the market price goes. Epic Electronics is offering some employees a
A) stock annuity plan.
B) stock reinvestment plan.
C) stock dividend.
D) stock option plan.

Question

Quizplus · Accepted Answer

A stock option plan allows employees to buy their firm's stock at a specific price for a specific period of time. If the value of the stock rises, this can allow employees to acquire the stock at huge savings.

Martin Works for Epic Electronics, a Sophisticated Electronic Equipment Company