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Strategies & Market Trends : Good Investment Theses: VALUATIONS w/ FUNDAMENTAL ANALYSIS -- Ignore unavailable to you. Want to Upgrade?

To: Edwarda who wrote (62)	4/24/1999 4:29:00 PM
From: Chuzzlewit	Read Replies (2) \| Respond to of 160

Yes, I have compressed time. I like to simplify arguments before adding layers of complexity. If you concede that there is a real cost to shareholders, then we have a basis for reflecting the true cost on the income statement. And here's how I think it could be done equitably: 1. There are actuarial tables that could be applied (just as tables exist for pension vesting) that would reflect the probability of employees actually exercising the options; 2. The Black Scholes equations could be used to determine the value of the options. Could you scratch just a bit lower? CTC