Question

Teresa bought $50 worth of stock in Apple when she was in college. Recently, Teresa sold the stock and made a lot of money. This is an example of what type of income?
A. unemployment income

B. earned income

C. investment income

D. passive income

Answer 1

Answer:

C. investment income

Explanation:

Investment refers to any commercial activity undertaken to generate profits or grow wealth. It involves risking one's capital and resources to make more money. Investment income refers to the proceeds of investments such as interests paid, profits, dividends, and capital gain.

Teresa earned profits as a result of capital gains. The shares appreciated in value resulting in capital gain.