Vertical, Inc

question 23

Multiple Choice

Vertical, Inc., has a 2014 net § 1231 gain of $67,000 and had a $22,000 net § 1231 loss in 2013. For 2014, Vertical's net § 1231 gain is treated as:

• A) $45,000 long-term capital gain and $22,000 ordinary loss.
• B) $67,000 ordinary gain.
• C) $45,000 long-term capital gain and $22,000 ordinary gain.
• D) $67,000 capital gain.
• E) None of the above.

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Definitions:

Nondiscriminating Pure Monopolist

A monopolistic market structure where a single seller offers a product to all consumers at the same price without price discrimination.

Economic Profit

The difference between total revenue and total costs, including both explicit and implicit costs, indicating the additional value created beyond the opportunity cost.

Normal Profit

The lowest amount of profit a business must earn to stay relevant in its market by covering the costs of missed opportunities.

Marginal Cost

The cost increase brought about by the production of an extra unit of a product or service.