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Pekoe sold stock to Rose for $13,000, its fair market value. The stock cost Pekoe $16,000 5 years ago. Also, Pekoe sold Earl (an unrelated

Pekoe sold stock to Rose for $13,000, its fair market value. The stock cost Pekoe $16,000 5 years ago. Also, Pekoe sold Earl (an unrelated party) stock for $6,500 that cost $7.500 3 years ago. Rose and Pekoe are brother and sister. What is Pekoe's recognized loss?

A. $6,500

B. $4,000

C. $3,000

D. $1,000

E. $0

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