1. Analyze how non-cash compensation can be abused by management within a company and the related risks to the long-term stability of the company. After considering the potential for problems with this method of employee rewards, determine whether the advantages outweigh the disadvantages, and justify your position.

2. Make a recommendation to CFO of your organization about the least costly method to reward employees of these three, indicating how such a system will likely be perceived by employees. State your rationale for selecting the method.