ECONOMICS
SAVING AND INVESTING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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depositing money in compounding accounts
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lending money and charging interest
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selling an investment for more than they paid for it
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selling many investments at the same time
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Detailed explanation-1: -When you invest in shares, you make capital gains on the sale of shares which are taxable. Capital gains is the difference between the selling price and purchase price of the equity share. The rate of taxation on capital gains depends on how long you stayed invested in the stocks.
Detailed explanation-2: -If an equity investment rises in value, the investor would receive the monetary difference if they sold their shares, or if the company’s assets are liquidated and all its obligations are met.
Detailed explanation-3: -If you sell an asset for more than you paid for it, your profit (minus your cost basis) is called a capital gain. Short-term capital gains are profits from selling assets you own for a year or less. They’re usually taxed at ordinary income tax rates (10%, 12%, 22%, 24%, 32%, 35%, or 37%).
Detailed explanation-4: -There are 5 different ways for the investors to make money from an equity investment: Dividend: As an owner, the investor is entitled to a share in the profits of the company. If the company chooses to distribute these profits through dividend, the investor earns a specific amount for every share he owns.
Detailed explanation-5: -There are two primary ways to earn money from shares-through capital appreciation and from dividends.