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This Trust Is Established by Your Will and Becomes Effective

question 18

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This trust is established by your will and becomes effective upon your death.


Definitions:

Sunk Cost

A sunk cost refers to money already spent and permanently lost, which cannot be recovered and should not impact future business decisions.

Externality

A cost or benefit that affects a party who did not choose to incur that cost or benefit, often seen in environmental and public goods scenarios.

After-tax Proceeds

The net amount received after taxes are deducted from the gross proceeds of a sale or transaction.

Tax Shield

A deduction allowed by the tax laws that lowers a person's or corporation's taxable income and thus their tax liability.

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