Advanced Corporate Finance
compensation takes the form of stock options.
Apple’s current share price is $491. The exercise price of
your stock option is $520. The value of the stock option is equal to the
difference between Apple’s stock price and the exercise price of $520, at the
time that you exercise the option.
As an option holder yourself, would you prefer that Apple
uses dividends or share repurchases to pay out cash to its shareholders?





