LO4 During August 2007,Madeline invests $400,000 in Qual Company, Inc., buying Communication Skills 100,000 shares of stock. Her broker tells her this will be an excellent investment because the securities are qualified small business stock. He predicts the stock will triple in value over the next 3 years. At the end of 2009, Madeline’s shares are valued at

$700,000. Madeline is encouraged. She decides to cash out of this investment in December 2010 if the stock continues to appreciate. Madeline comes to you for advice. Write a letter advising her what she should do.