Efrain Owns 1,000 Shares of RJ Inc

question 1698

Multiple Choice

Efrain owns 1,000 shares of RJ Inc. common stock which he purchased three years ago for $36,000. Efrain sells the 1,000 shares on October 15, 2018, for $10,000. On November 12, he purchases 400 shares of RJ Inc. preferred stock for $8,000. Efrain's recognized loss on the sale of the 1,000 shares will be

• A) $15,600.
• B) $10,400.
• C) $0.
• D) $26,000.

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Definitions:

Permanent Benefits

Long-term advantages or income received from an investment, job, or government policy.

Potential Benefits

The possible advantages or gains that could be realized from a particular action or investment.

Little Bit of Inflation

A slight increase in the general level of prices which can indicate a healthy economy by encouraging spending and investment.

Federal Reserve

The central banking system of the United States, which regulates banks, manages the country's money supply, and aims to ensure economic stability.