Read the passage below and answer the two questions below it. Currently, a Google employee holding an
Question:
Read the passage below and answer the two questions below it.
Currently, a Google employee holding an option with a strike price of $450, compared with the market price of $500, can realize only the ___________, by exercising the options, selling in the market, and pocketing the difference. But another investor should be prepared to pay more than $500 for the unvested option, depending on its life, to reflect the possibility that the stock will rise before the option expires.
a. Regarding the first sentence: if the employee exercises the option, he or she will realize what? (That is, complete the sentence.)
b. Regarding the second sentence: what does this sentence mean for the option?
Step by Step Answer:
Understanding Investments Theories And Strategies
ISBN: 9780367461904
2nd Edition
Authors: Nikiforos T. Laopodis