An executive compensation plan in which the executive may receive compensation in cash, shares, or a combination of both, is known as
A) a nonqualified shares option plan.
B) a performance-type plan.
C) a stock appreciation rights plan.
D) both a performance-type and a stock appreciation rights plan.

Question

Quizplus · Accepted Answer

A performance-type plan is one in which the executive's compensation is tied to the performance of the company, while a stock appreciation rights plan allows the executive to receive compensation based on the rise in the company's stock price. By offering both options, the executive is given the choice to receive compensation in the form that suits them best, which can be beneficial for both the executive and the company. Therefore, the correct answer is both a performance-type and a stock appreciation rights plan.

An Executive Compensation Plan in Which the Executive May Receive