Match the Following Items with the Statements Below

question 17

Multiple Choice

Match the following items with the statements below. Terms may be used more than once.
-Solar currently operates nine lines of business that have been in existence for ten years. To protect its assets from possible lawsuits, Solar transfers each division to newly formed corporations in exchange for all of the stock of the new corporations. Solar distributes the stock in the nine new corporations to its shareholders in exchange for 45% of their stock in Solar.

• A)Boot
• B)Business credits
• C)Capital gain
• D)Continuity of business enterprise
• E)Continuity of interest
• F)Dividend
• G)Discount rate
• H)Earnings and profits
• I)​Federal long-term tax-exempt rate
• J)Liability assumption
• K)Ordinary gain
• L)Ownership change
• M)Section 382 limitation​
• N)Sound business purpose
• O)Step transaction

---

Definitions:

Demand

The quantity of a good or service that consumers are willing and able to purchase at various prices within a given time period.

Supply

The total amount of a product or service that is available to consumers at a specific price over a given period.

Economy Moves

Refers to the overall changes or shifts in economic activity, growth, and health within a particular economy over time.

Ceteris Paribus

A Latin phrase meaning "other things being equal," used in economics to isolate the effect of one variable by holding others constant.