If a Stock Was Purchased for $3000 in January 2003

question 35

Multiple Choice

If a stock was purchased for $3000 in January 2003 and is sold in December 2003 for $4000, what is the taxable result?

• A)Capital gain of $1000 and taxable income of $500
• B)Business income of $1000 and taxable amount of $1000
• C)Capital gain of $1000 and taxable income of $1000
• D)Capital income of $1000 and taxable capital of $500

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Definitions:

Extinction

In psychology, the gradual weakening and disappearance of a conditioned response when the conditioned stimulus is no longer paired with the unconditioned stimulus.

Spontaneous Recovery

The reappearance of a previously extinguished conditioned response after a pause, without new learning trials.

Higher-Order Conditioning

A process in classical conditioning by which a stimulus that was previously neutral is paired with a conditioned stimulus to produce the same conditioned response as the original conditioned stimulus.

Extinction

In biology, the end of an organism or of a group of organisms, normally a species; in psychology, the process through which a conditioned response is eliminated through repeated exposure without reinforcement.