Identify Which of the Following Statements Is False

question 68

Multiple Choice

Identify which of the following statements is false.

• A)Every grantor is entitled to a $5.25 million exemption from the GSTT in 2011.
• B)If Greg transfers assets directly to his grandson, this transaction would be an example of a direct skip.
• C)If Shaad transfers property in trust to his son, with the remainder to his grandson, at the death of the son a taxable termination will result.
• D)The GSTT is levied at a flat rate, which is higher than the top rate under the estate tax rate schedule.

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Definitions:

Forgone Interest

The potential interest earnings lost by choosing to invest capital in one option over an alternative that offers a higher return.

Short-Run Adjustment

The process by which businesses alter their production levels or inputs in response to short-term changes in market conditions.

Local Bakery

A place of business that specializes in producing and selling bread, cakes, and other baked goods to consumers within a specific area.

Plastics Industry

An economic sector involved in the production, distribution, and recycling of plastic materials and products.