Goldman Sachs Superday Practice Test 2026 – Complete Exam Preparation

Equity incentives change ownership because they can create new shares when options are exercised or RSUs vest. In deal models and dilution analyses you treat those awards as dilutive, meaning you include them in the share count used to measure value and ownership. This gives a fully diluted view of metrics like EPS and the per-share value that existing shareholders actually own. If you didn’t account for them, you’d be overstating per-share value because more shares could come into existence. In practice, you use a fully diluted share count and methods like the treasury stock method to estimate how many new shares would appear from options and warrants, plus count RSUs as they vest. So, equity incentives do dilute existing shareholders and must be reflected in both share counts and per-share metrics.