Identify Which of the Following Statements Is False

question 107

Multiple Choice

Identify which of the following statements is false.

• A)The distribution of stock rights will be taxable if the value of the stock rights is more than 15% of the value of the underlying stock.
• B)The distribution of stock rights is generally tax free under Sec. 305.
• C)If the value of stock rights is less than 15% of the value of the underlying stock, the basis of the rights is zero unless the shareholder elects to allocate basis to the rights.
• D)The holding period for stock rights includes the holding period for the underlying stock.

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Definitions:

Kelley's Attribution Theory

A theory suggesting that individuals make sense of their social world by attributing causes to their own and others' behavior, focusing on consistency, distinctiveness, and consensus.

High Distinctiveness

A term in social psychology referring to the extent to which an individual's behavior can be attributed to the circumstances rather than internal traits.

Situational Attribution

The process of attributing behavior to external or environmental factors, rather than internal characteristics.

Fundamental Attributional Error

The fundamental attributional error is a cognitive bias that leads individuals to overemphasize personality traits and underestimate situational factors when explaining others' behaviors.