Executive stock options are outstanding all year that permit executives to buy 12 million common shares at $50. The average market price of the common stock was $60. When calculating diluted earnings per share, the assumed exercise of these options will increase the weighted average number of shares outstanding by:
A) zero shares.
B) 2 million shares.
C) 8 million shares.
D) 10 million shares.
Answer: B) 2 million shares.
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