Which of the Following Statements About Share-Based Managerial Compensation Is

Multiple Choice

Which of the following statements about share-based managerial compensation is correct?

A) It may cause dysfunctional behaviour in the short-run as managers try to drive up the company's share price.
B) Exercising the option as soon as it is granted will leave the manager better off from a cash standpoint.
C) Share options are always guaranteed to increase in value over time.
D) Managers always prefer to receive share options instead of year-end bonuses.