Ava Has Net Earnings from Self-Employment of $125,000

question 10

Multiple Choice

Ava has net earnings from self-employment of $125,000.She also earned salary of $170,000 from a job held earlier in the year.How much Additional Medicare Tax will be owed on the self-employment income?

• A)$0
• B)$769
• C)$855
• D)$3,625

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Definitions:

Marginal Cost

The cost of producing one additional unit of a good or service, computed by dividing the change in total cost by the change in quantity produced.

Moral Hazard

The risk that one party to a contract can change their behavior to the detriment of the other party once the contract has been concluded.

Automobile Driving

The operation and control of a car, including the mastery of various techniques and understanding of road rules for safe transportation.

Marginal Cost

The additional cost incurred from producing one more unit of a good or service.