The Return Calculated Assuming the Property Is Held for One

question 12

Multiple Choice

The return calculated assuming the property is held for one additional year is referred to as the:

• A)After-tax cash flow from sale
• B)Marginal rate of return
• C)Reinvestment rate
• D)None of the above

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Definitions:

Short-term Capital Gain

A profit from the sale of an asset held for one year or less, taxed as ordinary income.

Long-term Capital Loss

A loss realized from the sale of a capital asset held for more than one year, which can offset capital gains and reduce taxable income.

Recognized Gains

Profits from the sale of an asset that are realized and subject to capital gains tax.

Tax Bracket

A range of income subject to a particular income tax rate. Tax systems often have several brackets, with individuals paying a higher rate as their income increases.