1. A company that has very predictable cash flows can be expected to?
a. Trade at a higher P/E than one without
b. Predictability of cash flows has nothing to do with stock value
c. Trade at a lower P/E than one without
d. None of the above
e. all of the above
2. Anton was granted a nonstatutory stock option on October 15, 2010. He exercised the option on June 13, 2012. The option specified that Anton must sell the stock back if he leaves the company for any reason before October 15, 2016. When is the compensation recognized?
1) October 15, 2010
2) June 13, 2012
3) October 15, 2016
4) Not enough information to make this determination.