What is the purpose of an Employee Stock Purchase Plan (ESPP)?

The Employee Stock Purchase Plan (ESPP) is designed primarily to allow employees to purchase company shares at a discounted rate, making B the correct choice. This program encourages employees to invest in their company's stock, aligning their interests with that of the company's performance and overall success.

The discount typically applied when purchasing stock through an ESPP can make buying shares more financially accessible for employees, fostering a sense of ownership and engagement. This proactive involvement can enhance motivation and dedication, as employees see a direct connection between their efforts and the company's performance in the market.

The other options do not accurately reflect the purpose of an ESPP. For instance, bonuses based on company performance are typically structured as cash incentives rather than stock purchases. While stock options may play a role in broader compensation strategies, an ESPP specifically focuses on providing employees an opportunity to acquire stock, rather than solely saving for retirement. Lastly, income protection during employment generally pertains to benefits like insurance or disability coverage, which is not within the scope of what an ESPP offers.