Andrew is excited about the new program at work.He will be allowed to purchase 20 shares of stock at $45 per share for a limited period of time.Andrew is planning to take advantage of this ____ plan because he expects that the market price of the stock will far exceed $45 in a couple years.
A) windfall incentive
B) gainsharing
C) stock option
D) employee stock ownership (ESOP)

Question

Quizplus · Accepted Answer

The description of the plan matches that of a stock option, where an employee can purchase a specified amount of company stock at a set price within a certain window of time. Andrew believes that the market price of the stock will increase, so he plans to exercise his option to buy the 20 shares at the lower price and then sell them for a profit later on.

Andrew Is Excited About the New Program at Work