Suppose You Purchased 100 Shares of Stock in 2010 for $25

question 51

Multiple Choice

Suppose you purchased 100 shares of stock in 2010 for $25 a share and you sell them today for $50 a share. If the capital gains tax is 28 percent, your tax liability is

• A)$70.
• B)$700.
• C)$2500.
• D)indeterminate without knowing the inflation rate.

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Definitions:

P-Value

The probability of observing test results at least as extreme as the results actually observed, assuming that the null hypothesis is correct.

Left Tailed

Refers to a type of hypothesis test where the area of interest, or region of rejection, is located in the left tail of the distribution.

Test-Statistic

A quantity derived from sample data used in a hypothesis test to make a decision about the population parameter.

Right Tailed

Pertaining to a type of hypothesis test where the area of interest is in the right tail of the distribution, typically testing for values greater than a certain number.