Maud Exchanges a Rental House at the Beach with an Adjusted

question 14

Multiple Choice

Maud exchanges a rental house at the beach with an adjusted basis of $225,000 and a fair market value of $200,000 for a rental house at the mountains with a fair market value of $180,000 and cash of $20,000. What is the recognized gain or loss?

• A) $0
• B) $20,000
• C) ($20,000)
• D) ($25,000)
• E) None of the above

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Definitions:

General Adaptation Syndrome

A theory in psychology that defines the three stages of response (alarm, resistance, exhaustion) that the body goes through when exposed to chronic stress.

Type D Personality

A personality type characterized by high levels of stress, negativity, and the tendency to experience uncomfortable emotions.

Internal Locus

A psychological concept referring to individuals who believe they have control over their life events and outcomes.

Locus of Control

A psychological concept referring to the extent to which individuals believe they have control over the outcomes of events in their lives.