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Following tables show information on Facebook Inc's executive compensation and stock price. As shown in the Tables, the CEO of Facebook Inc received a salary,
Following tables show information on Facebook Inc's executive compensation and stock price. As shown in the Tables, the CEO of Facebook Inc received a salary, bonus, and stock options in 2012. How much will Mr. Mark Zuckerberg's wealth (from the above compensation, which includes stock and option grants) increase for \$1 increase in Facebook Inc's stock price (as of December 2012)? (1) Find z (note: loge(26.62/0.06)=LN(26.62/0.06)=6.0951) z=Ttloge(KS)+(rd+212)(Tt)= (2) Find delta for 1 share of option Option Delta =(z)ed(Tt)= (3) Find increase on CEO's wealth for $1 increase in Facebook stock price ( note: stock delta =1 ) Wealth increase =( Number of options )( option delta )+( Number of stocks )( stock delta ) Normal Distribution ity Function: (z)=21e2z2 where z=x ( is the mean, is the standard deviation) ibution Function: (z)=z11e2x2dx
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