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Helen holds 1,000 shares of Fizbo Inc. stock that she purchased 11 months ago. The stock has done very well and has appreciated $20/share since
Helen holds 1,000 shares of Fizbo Inc. stock that she purchased 11 months ago. The stock has done very well and has appreciated $20/share since Helen bought the stock. When sold, the stock will be taxed at capital gains rates (long-term rate is 15 percent and short-term rate is the taxpayers marginal tax rate). Ignore the time value of money.
a. If Helens marginal tax rate is 35 percent, how much would she save by holding the stock an additional month before selling?
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