In the debate regarding whether stock options should be an expense, which of the following was not a reason supporting such an expense?

Multiple Choice

• Expensing stock options would reduce the dilution effect caused by the issuance of excessive grants to top executives.

• Expensing stock options would yield more accurate earnings measurement and restore investor confidence.

• Expensing stock options would spur risk-taking and entrepreneurship that are crucial to innovation.

• Expensing stock options would reduce the incentive managers have to pump-up short term earnings for market price gains.