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A customer has a stock position that has increased in value since the time he purchased it. Which of the following terms describes his current situation?
Correct Answer: B
An unrealized gain occurs when the value of an asset increases but has not yet been sold. If the customer sells the stock, the unrealized gain becomes a realized gain. * B is correctbecause the increase in value without selling the stock is an unrealized gain. * Ais incorrect because interest income refers to earnings from fixed-income securities. * Cis incorrect because operating profit relates to a company's earnings, not an investor's portfolio. * Dis incorrect because "out of the money" is a term used for options, not stocks.