Dan Transfers an Apartment Building to Grace but Retains the Right

question 4

Multiple Choice

Dan transfers an apartment building to Grace but retains the right to the rental income for 10 years. Dan dies nine years after the transfer when the building is worth $600,000. The applicable federal rate is 10% and the reversionary actuarial factor is 0.30. How much would be included in Dan's estate?

• A)$0
• B)$150,000
• C)$350,000
• D)$600,000

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Definitions:

Complex Number

A number that can be expressed in the form a + bi, where a and b are real numbers and i is the square root of -1.

Standard Form

A way of writing numbers, typically large or small, using powers of ten, or a general way of writing equations in mathematics.

Complex Number

A number that can be expressed in the form a + bi, where a and b are real numbers and i is the imaginary unit.

Multiplicative Inverse

The number that, when multiplied by a given number, results in a product of one. It is also known as the reciprocal.