Byron is a wealihy tycoon who makes his money buying and selling stocks. This is an example of ___ income. a. capital gains b. earned c. hourly d. passive Please select the best answer from the choices provided

The best answer is a. capital gains. Capital gains refer to the profits made from selling an asset, such as stocks, at a higher price than the purchase price. Byron's wealth accumulation through buying and selling stocks exemplifies how investors can generate income through strategic financial moves rather than traditional methods of earning wages. In the world of investing, understanding capital gains is crucial for tax purposes too! Long-term capital gains—profits from assets held for over a year—are often taxed at a lower rate than ordinary income, making them a favorite for savvy investors like Byron. So, staying informed about tax laws can help maximize those gains and keep more cash in your pocket!