The yield to maturity on a consol bond that pays $200 yearly and sells for $1000 is

Joe has owned shares in a company that has a dividend reinvestment plan since 2004. The plan allows him to invest more cash to buy additional shares of stock at a price less than fair market value. In 2016, Joe took advantage of that option and purchased 100 additional shares for $30 each. On the dividend payment date, the fair market value of the shares he purchased was $32 per share. Based on this information, Joe must report

a. $200 of long-term capital gain income, based on the fact that Joe has owned shares in the company for more than 18 months. b. $0. No income must be reported until the shares are sold. c. $200 of short-term capital gain income, based on the fact that Joe could not have taken advantage of the option to buy the shares at the discounted price if he had not taken part in the dividend reinvestment plan. d. $200 as ordinary income, based on the difference between the amount Joe paid and the fair market value of the shares.

According to the foreseeability test, a breaching party is liable only for those damages that he foresaw or ought to have foreseen

Indicate whether the statement is true or false