Suppose the annual inflation rate is 10%, and an asset bought at the beginning of the year for $100,000 is sold for $115,000. If the capital-gains tax rate is 30%, what is the (approximate) effective tax rate on the sale of this asset?
A) 10%
B) 20%
C) 25%
D) 30%
E) 4%
E
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Economic theory suggests that ________ interest rates are ________ important than ________ interest rates in explaining investment behavior
A) nominal; more; real B) real; less; nominal C) real; more; nominal D) market; more; real
The fewer the stockholders in a corporation the __________ likely they are to be motivated to monitor the corporation's management, thus the __________ the severity of the manager-stockholder conflict
A) more; greater B) more; fewer C) less; greater D) less; fewer
Which of the following anti-inflation policies imposes costs on society?
A) price controls B) indexation C) reduced growth in nominal demand D) all of these
Import quotas on steel tend to result in higher quantities of steel being sold at lower prices than would be observed in the absence of a quota
Indicate whether the statement is true or false