B IS CORRECT. STOCK APPRECIATION RIGHTS DO NOT CAUSE DILUTION TO TH...

8. - CFA 2018 LEVEL 2 FRA QUESTION BANK EMPLOYEE COMPENSATION QBANK
CFA 2018 LEVEL 2 FRA QUESTION BANK EMPLOYEE COMPENSATION QBANK
8. B is correct. Stock appreciation rights do not cause dilution to the existing shareholders since no shares are actually issued.

The

payoff of phantom stocks is based on the performance of hypothetical stock instead of the firm’s actual shares.