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A capital gain is when you sell something for more money than you originally paid for it. Imagine you bought a bike for $100 and later sold it for $150. You made a capital gain of $50 because you sold it for more than you bought it for.
For example, someone bought a piece of land for $10,000 and later sold it for $15,000. They made a capital gain of $5,000 because they sold it for more than they paid for it.
"Wit & Whimsy with the Dumb Ox: Unlocking Knowledge with Rhyme:"
In the land of Profit-Cheer,
Capital gains are held quite dear.
When you buy low and sell high,
You make a gain, oh me, oh my!
A fellow bought land, as you see,
For ten thousand dollars, plus a small fee.
He sold that land for fifteen grand,
And made a capital gain, quite grand!