If Tomas purchases a share of stock for $150 and one year later sells it for $225, he will realize a
A) dividend of $75.
B) capital gain of $75.
C) dividend of $225.
D) a capital gain of $225.

Question

Quizplus · Accepted Answer

A dividend is a distribution of a portion of the company's profits to its shareholders, which is not mentioned in the scenario. The increase in value from the purchase price of $150 to the selling price of $225 is a capital gain. Therefore, the correct answer is B, as Tomas will realize a capital gain of $75.

If Tomas Purchases a Share of Stock for $150 and One