Kyle Drives a Race Car in His Spare Time and on Weekends

question 101

Multiple Choice

Kyle drives a race car in his spare time and on weekends. His records regarding this activity reflect the following information for the year. What is the allowable deduction (before any AGI limitation) for depreciation assuming that this activity is not engaged in for profit and Kyle can itemize his deductions?

• A) $0
• B) $300
• C) $1,400
• D) $1,700

---

Definitions:

Utility

In economics, the total satisfaction received from consuming a good or service.

Consumer Surplus

The difference between what consumers are willing to pay for a good or service and what they actually pay.

Marginal Utility

The extra pleasure or benefit a customer receives from purchasing an additional unit of a product or service.

Total Utility

The total satisfaction or benefit obtained from consuming a particular quantity of goods or services.