George and Georgette Divorced in 2017

question 40

Multiple Choice

George and Georgette divorced in 2017.George was ordered to pay (and does pay) Georgette $600 per month alimony and $800 per month child support.In addition, George transferred title to his half of their stock to Georgette last year.The stock had a basis of $120,000 and a fair market value of $260,000 at the date of the transfer.This year Georgette sells the stock for $280,000.What is Georgette's income for this year if she has no other income items?

• A)$7,200
• B)$19,200
• C)$159,200
• D)$167,200

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Definitions:

Binding Price Floor

A government-imposed price control or limit that sets a minimum price above the equilibrium price, leading to surplus in the market.

Price Paid

The actual amount of money exchanged for a good or service.

Supply and Demand

Fundamental economic model describing how prices and quantities of goods and services are determined in a market based on the relationship between the quantity supplied and the quantity demanded.

Price Floor

A government or regulatory minimum price set for a commodity, below which it cannot legally be sold.