A Worthless Security Had a Holding Period of 11 Months

question 110

Multiple Choice

A worthless security had a holding period of 11 months when it became worthless on December 10, 2012.The investor who had owned the security had a basis of $10,000 for it.Which of the following statements is correct?

• A)The investor has a long-term capital loss of $10,000.
• B)The investor has a short-term capital loss of $10,000.
• C)The investor has a nondeductible loss of $10,000.
• D)The investor has a short-term capital gain of $10,000.
• E)None of the above.

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Definitions:

Globalization

The worldwide interdependence of resource flows, product markets, and business competition.

Economic Integration

A process whereby countries reduce trade barriers, allowing for an increased flow of goods, services, and capital among them, aiming for economic policy convergence.

Nation States

Political entities consisting of a clearly defined territory and a government that has sovereignty over its internal and external affairs.

Hofstede's Framework

A model developed by Geert Hofstede that analyzes cultural dimensions and their impact on organizational behavior and communication across different nations.