A stock option will have value to a worker if:
A)the firm's stock price is expected to rise
B)the firm's stock price is expected to fall
C)the "grant price" of the stock is expected to exceed its market price
D)none of the above

Question

Quizplus · Accepted Answer

A stock option will have value to a worker if the firm's stock price is expected to rise. This is because the worker can use the option to purchase the stock at a lower price (the grant price) and then sell it at a higher price, profiting from the difference. If the firm's stock price is expected to fall or if the grant price is already higher than the market price, the option would not be valuable to the worker.

A Stock Option Will Have Value to a Worker If