Earned income and capital gains (or "portfolio income") are acquired in different ways. Which statement describes how they are different?

A. Earned income and capital gains are both based on the number of hours you work.
B. Earned income is payment for employment, while capital gains are produced by your investments.
C. Capital gains are received if you manage the company, but earned income is received if you are an employee of the company.
D. Earned income is when you make the investment directly, but capital gains are when someone else has managed your investments.

Question

13-06-2024
Business

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Earned income and capital gains (or "portfolio income") are acquired in different ways. Which statement describes how they are different?

A. Earned income and capital gains are both based on the number of hours you work.
B. Earned income is payment for employment, while capital gains are produced by your investments.
C. Capital gains are received if you manage the company, but earned income is received if you are an employee of the company.
D. Earned income is when you make the investment directly, but capital gains are when someone else has managed your investments.

Sagot :

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GinnyAnswer GinnyAnswer · Answer 1 · 2024-06-13T01:08:08-04:00

GinnyAnswer GinnyAnswer

13-06-2024

Final answer:

Earned income is from employment, while capital gains come from investments.

Explanation:

Earned income is payment for employment, such as wages, salaries, and commissions, based on the hours worked. On the other hand, capital gains are profits generated from investments, like selling stocks at a higher price than purchased.

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