Responses
An investor earns a $20 return from a bond held until maturity.
An investor earns a $20 return from a bond held until maturity.
An investor purchase a stock for $30 and then later sells it for $25.
An investor purchase a stock for $30 and then later sells it for $25.
An investor earns a $20 return from a savings deposit.
An investor earns a $20 return from a savings deposit.
An investor purchases a stock for $25 and then later sells it for $30.
1 answer
A capital gain occurs when an asset, such as stock, is sold for more than its purchase price.
In this case, the correct illustration of a capital gain is:
"An investor purchases a stock for $25 and then later sells it for $30."
This results in a capital gain of $5.
