Zeppo and Harpo Are Equal Owners of the Marx Corporation

question 55

Multiple Choice

Zeppo and Harpo are equal owners of the Marx Corporation. During the current year, they agree to admit Groucho as a shareholder. Groucho will contribute $25,000 in cash and property worth $50,000 (adjusted basis of $35,000) for 25% of Marx Corporation's stock. What is Groucho's basis in the Marx Corporation stock?

• A)$45,000
• B)$50,000
• C)$60,000
• D)$75,000
• E)$90,000

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Definitions:

Frustration Aggression Hypothesis

A theory suggesting that frustration, or the blockage of achieving a goal, leads to aggressive behavior as a form of displaced reaction.

Reaction Formation

A defense mechanism where an individual unconsciously replaces unacceptable thoughts or feelings with their opposites.

Displacement

A defense mechanism where emotional impulses are redirected from the original object to a safer or less threatening object.

Attachment Theory

A psychological model that describes the dynamics of long-term interpersonal relationships between humans, emphasizing the importance of attachment in personal development.