Verway, Inc

question 3

Multiple Choice

Verway, Inc., has a 2012 net § 1231 gain of $55,000 and had a $62,000 net § 1231 loss in 2011.For 2012, Verway's net § 1231 gain is treated as:

• A)$55,000 ordinary loss.
• B)$55,000 ordinary gain.
• C)$55,000 capital loss.
• D)$55,000 capital gain.
• E)None of the above.

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Definitions:

Correlation Coefficient

A statistical measure that calculates the strength and direction of a linear relationship between two variables.

Weighted Average

A calculation that multiplies each component by a factor reflecting its importance or relevance, then summing these products to obtain an average.

Statistically Significantly

A measure of confidence in statistical analysis indicating that the observed effect is unlikely to be due to chance.

Diversified Portfolio

An investment strategy that involves spreading investments across various asset classes to reduce risk and volatility.