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Hazel Received 20 NQOs (Each Option Gives Her the Right

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Essay

Hazel received 20 NQOs (each option gives her the right to purchase 10 shares of stock for $7 per share)at the time she started working when the stock price was $14 per share.Now that the share price is $20 per share,she intends to exercise all of her options.If Hazel holds the shares for two years and sells them when the market price is $25,how much gain will Hazel recognize on the sale and how much tax will she pay assuming her marginal tax rate is 25 percent?


Definitions:

Indispensable

Absolutely necessary or essential.

Normal Growth

The typical progression of physical development in an individual or organism, often measured against standardized benchmarks.

Strength of Emotions

The intensity or power of one's emotional responses or feelings.

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