Sarah Slick is kicking herself for having bought the stock of Bounce, Inc.at a higher price than she needed to have paid. She bought it at $50 a share on November 20th and watched its price drop during December. Ms. Slick is confident that Bounce’s stock price will bounce back (pun intended), but she decides that in the meantime, she will sell her shares and use the realized capital loss to offset some of the capital
gains she has realized on other investments during the year. Thus, on December 30th, she sells her shares of Bounce for $40 a share. During the first couple weeks of the new year, Sarah observes Bounce’s price creeping upward, and she buys the same number of shares she previously sold for $45 a share on January 18th. Given this scenario, which of the following statements is true?
