Which statement is correct regarding a company which buys call options on its own shares from an outside company?
A)Issued options are always antidilutive.
B)Issued options are always dilutive.
C)Purchased options are always antidilutive.
D)Purchased options are always dilutive.

Question

Quizplus · Accepted Answer

Purchased call options on its own shares are considered antidilutive because if exercised, they would lead to the company buying back its own shares, potentially increasing the value of the remaining shares by reducing the number of shares outstanding.

Which Statement Is Correct Regarding a Company Which Buys Call