incentive option

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Explanation of "Incentive Option"

Definition:
An "incentive option" is a special choice or benefit given to company executives. It allows them to buy company stock at a set price if the company meets specific financial goals, like earning a certain amount of money or increasing its profits.

Usage Instructions:

• Part of Speech: Noun
• Context: Used primarily in business and finance, especially regarding employee benefits and compensation.

Example:

• "The company offered its executives an incentive option that would allow them to buy shares at a lower price if they reached their sales targets."

Advanced Usage:

• In some cases, incentive options are part of a broader compensation package, including salaries and bonuses. They are designed to motivate executives to work hard for the company's success.

Word Variants:

• Incentive (noun): A thing that motivates or encourages someone to do something.
• Option (noun): A choice or selection.

Different Meanings:

• Incentive (in general): Can refer to any reward or reason that motivates someone to act.
• Option (in general): Can refer to any choice available to someone.

Synonyms:

• Incentive: Motivation, encouragement, stimulus
• Option: Choice, alternative, selection

Related Idioms:

• "Carrot and stick": A strategy of offering a combination of rewards (carrot) and punishments (stick) to motivate someone.

Phrasal Verb:

• There aren't specific phrasal verbs directly associated with "incentive option," but related verbs might include:
  • "Work towards": To strive to achieve something, often used in the context of aiming for financial goals.
  • "Cash in on": To take advantage of a situation, which can apply to executives using their incentive options when the company's stock price is high.

Summary:

An "incentive option" is a financial tool used by companies to encourage their executives to perform well by rewarding them with the chance to buy stock at a favorable price if they achieve certain goals.

Academic

Noun

1. an option granted to corporate executives if the company achieves certain financial goals

Synonyms

• incentive stock option