Question

the abbreviation 'ESOP' stands for ___________.

• A. Employee Stock Option Plan
• B. Employee Share Option Plan
• C. Employee Share Option Programme
• D. Employee Stock Option Programme

Answer 1

The correct option is A Employee Stock Option Plan

Definition: An employee stock ownership plan (ESOP) is a type of employee benefit plan which is intended to encourage employees to acquire stocks or ownership in the company.
Description: Under these plans, the employer gives certain stocks of the company to the employee for negligible or less costs which remain in the ESOP trust fund, until the options vests and the employee exercises them or the employee leaves/retires from the company or institution.
These plans are aimed at improving the performance of the company and increasing the value of the shares by involving stock holders, who are also the employees, in the working of the company. The ESOPs help in minimizing problems related to incentives.