Which entity is typically able to offer stock options to raise money?

• A. C-Corporation
• B. Sole Proprietorship
• C. S-Corporation
• D. Partnership

Answer: (A)

Stock options are rights to buy company stock at a set price, used to raise capital and attract or retain talent. Only organizations that issue stock can grant these options. Sole proprietorships and partnerships don’t have stock to issue, so they can’t offer stock options in the usual sense. An S‑Corporation is a corporate form that passes income to shareholders and is limited by rules like one class of stock and certain shareholder limits, which can complicate broad stock‑option plans. A C‑Corporation, on the other hand, is designed to issue stock freely, attract investors, and support stock‑option compensation programs, making it the typical vehicle for offering stock options to raise money.