What Is the Difference Between Stock Options and an Employee

Multiple Choice

What is the difference between stock options and an employee stock ownership plan (ESOP) ?

A) Stock options carry significant risk, whereas ESOPs are risk-free.
B) Stock options are usually granted to company executives, whereas ESOPs are provided to all employees.
C) In stock options, stocks are placed into a trust, whereas ESOPs give employees the right to buy a certain number of shares of stock.
D) Under stock options, employees can sell their stocks, whereas ESOPs do not allow employees to sell their stocks.
E) Earnings from stock options are exempt from income taxes, whereas earnings from ESOPs are taxable.