Sally purchased one share of Stryker stock for $200 in year 1 and sold that share in year 2 for $400.The inflation rate between year 1 and year 2 was 50%.The tax on nominal capital gains is 50%.What was the tax on Sally's capital gain?

Question

Quizplus · Accepted Answer

Sally's nominal capital gain is $400 - $200 = $200. The tax on nominal capital gains is 50%, so the tax is 50% of $200, which is $100.

Sally Purchased One Share of Stryker Stock for $200 in Year