All EXCEPT Which One of the Following Are Good Ways

question 18

Multiple Choice

All EXCEPT which one of the following are good ways to acquire money for starting an investment program?

• A) pay bills first, and then save for investment
• B) participate in an employer-sponsored elective savings program
• C) make a special savings effort one month per year
• D) borrow money for investment purposes
• E) take advantage of gifts and inheritances

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Definitions:

FMV

Fair Market Value, the price at which property would change hands between a willing buyer and a willing seller, neither being under compulsion to buy or sell.

Distribution

The payment of dividends or assets to shareholders or partners from a corporation, partnership, or another type of entity.

Partnership

A type of business structure where two or more people share ownership, as well as the responsibility for managing the business and the income or losses it generates.

Ordinary Income

Income earned through salaries, wages, commissions, and interest, subject to standard tax rates.