Deferral of Capital Gains TaxI) Means That the Investor Doesn't

question 35

Multiple Choice

Deferral of capital gains taxI) means that the investor doesn't need to pay taxes until the investment is sold.II) allows the investment to grow at a faster rate.III) means that you might escape the capital gains tax if you live long enough.IV) provides a tax shelter for investors.

• A) II and III
• B) I, II, IV
• C) I, III, and V
• D) II, III, and IV

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Definitions:

Business Judgment Rule

A principle of corporate governance that shields a corporation's board of directors from liability for decisions made in good faith, with due care, and in the best interests of the corporation.

Shareholder's Direct Suit

A legal action initiated directly by a shareholder against the corporation, typically for actions that have caused harm directly to the shareholder.

Right of Obedience

The obligation of a fiduciary or agent to act in accordance with the directives of the principal, provided these instructions are legal and ethical.

Preponderance of the Evidence

A standard of proof in civil cases, signifying that one side's argument is more likely true than not based on the evidence presented.