If Teresa purchases a share of stock for $15 and three years later sells it for $60, she will realize a
A) dividend of $45.
B) dividend of $60.
C) capital gain of $45.
D) capital gain of $60.

Question

Quizplus · Accepted Answer

Teresa's profit from the sale of the stock is the difference between the selling price ($60) and the purchase price ($15), which is $45. This profit is referred to as a capital gain, not a dividend. Dividends are payments made by a corporation to its shareholders out of its profits.

If Teresa Purchases a Share of Stock for $15 and Three