Eric,age 80,has Accumulated About $3 Million in Net Assets

question 93

Multiple Choice

Eric,age 80,has accumulated about $3 million in net assets.Among his assets are the following marketable securities held as investments.

Eric would like to donate (either by lifetime or testamentary transfer) $250,000 in value to his church.In addition,to consummate a land deal,he needs $250,000 in cash.Looking solely to tax considerations and using only the assets described above,Eric's best choice is to:

• A)Donate by gift to the church the Crane stock and sell the Hawk stock now.
• B)Donate by death to the church the Hawk stock and sell the Cardinal stock now.
• C)Donate by gift to the church the Hawk stock and sell the Crane stock now.
• D)Donate by gift to the church the Cardinal stock and sell the Hawk stock now.
• E)None of the above is an attractive technique.

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Definitions:

Flexible Exchange Rate

Rate determined in foreign exchange markets by the forces of demand and supply without government intervention.

Fixed Exchange Rate

A currency system where the value of a currency is pegged to another currency, a basket of currencies, or a physical commodity like gold.

Exchange Rate

The price of one currency in terms of another, determining how much foreign currency can be exchanged for a unit of domestic currency.

Financial Transactions

Activities involving the exchange of money between parties, including buying, selling, lending, and borrowing.