Which of the Following Redemptions Normally Will Not Qualify for Sale

question 3

Multiple Choice

Which of the following redemptions normally will not qualify for sale treatment?

• A)A partial liquidation with the stock redeemed from a corporate shareholder
• B)A redemption from an estate to provide cash to pay death taxes
• C)A redemption that reduces taxpayer ownership from 30 percent to 20 percent
• D)A redemption of all the stock that the taxpayer owns

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Definitions:

Cultural Values Theory

The view that people in groups use members’ opinions about the position valued in the wider culture, and then adjust their views in that direction for social approval reasons.

Group Polarisation

The tendency of a group to make decisions that are more extreme than the initial inclination of its members.

Groupthink

A psychological phenomenon that occurs within a group of people, where the desire for harmony or conformity results in an irrational or dysfunctional decision-making outcome.

Risky Shift

Tendency for group discussion to produce group decisions that are more risky than the mean of members’ pre-discussion opinions, but only if the pre-discussion mean already favoured risk.