Which of the Following Statements About §351 Transactions Is False

question 23

Multiple Choice

Which of the following statements about §351 transactions is false?

• A)A transferor of property must receive stock equal to at least 80 percent of the fair value of the property transferred.
• B)In the aggregate, the transferors of property to the corporation must collectively own 80 percent of the voting stock of the corporation immediately after the transfers.
• C)Only property transferred to a corporation is eligible for deferral.
• D)All transfers of property to a corporation must be made simultaneously to qualify for deferral.

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Definitions:

Diminishing Returns

A rule in economics that holds that after reaching a certain level, further investments in a specific sector will not yield higher returns if all other conditions stay the same.

Law of Demand

The economic principle stating that as the price of a good increases, demand for that good will decrease, and vice versa.

Marginal Cost (MC) Curve

A graphical representation showing how the cost to produce one additional unit of output changes as production volume increases.

Pollution Abatement

Measures and efforts undertaken to reduce, control, or eliminate pollution from various sources to protect the environment.