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16. Eloise and Gunnar own a home with a small basement rental apartment. They love real estate. Now they’re considering buying commercial real estate . What kinds of properties are those? How does commercial real estate build wealth? _ ______________________________________________________________________________ _ ______________________________________________________________________________ _ ______________________________________________________________________________ _ ______________________________________________________________________________ 17. Eleven months ago Gunnar and Eloise bought 1000 shares of Hattie’s Hotter than Hot Hot Sauce Corporation for $15 a share. It is now worth $25 a share. They paid a fee of $50 to their brokerage firm to buy the shares and will be charged a commission of $50 to sell them. What is their basis in this stock? _ ______________________________________________________________________________ 18. What tax-related term refers to the increase in the value of an asset? _ ________________________ _ ______________________________________________________________________________ 19. If Gunnar and Eloise sell their Hattie’s Hotter Than Hot Hot Sauce stock will they have capital gain ? What is that and, if so how much? _ ______________________________________________________________________________ _ ______________________________________________________________________________ _ ______________________________________________________________________________ 20. Knowing what you know about capital gains tax , what’s your timing advice to Gunnar and Eloise about the sale of the hot sauce stock? Explain. _ ______________________________________________________________________________ _ ______________________________________________________________________________ _ ______________________________________________________________________________ PRODUCT PREVIEW
THE 21st CENTURY STUDENT’S GUIDE TO FINANCIAL LITERACY 211
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