Comet Company is owned equally by Pat and his sister Pam, each of whom hold 100 shares in the company. Comet redeems 50 of Pam's share on December 31 for $1,000 per share in a transaction that Pam treats as an exchange for tax purposes. What are the tax consequences to Comet because of the stock redemption? a. A reduction of $62,500 in E&P because of the exchange b. A reduction of $12,500 in E&P because of he exchange c. No reduction in E&P because of the exchange d. A reduction of $50,000 in E&P because of the exchange.