Refer to Theory in Practice re: Zions Bancorporation. Required a. Why would Zions Bancorporation use a market-
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a. Why would Zions Bancorporation use a market- based approach to estimating its stock option expense, instead of a model- based approach?
b. Why is the ESOARS- based ESO value so much lower than the model- based value? Assume that ESOARS purchasers are risk averse.
c. Do you agree with Zions’s approach? Explain why or why not.
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a Reasons for a marketbased approach to stock option expense Zions may feel that estimates based on models such as BlackScholes are unreliable and may ...View the full answer
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