Which of the Following Factors Is Not Used to Determine

question 109

Multiple Choice

Which of the following factors is not used to determine whether an activity is a hobby or a business?

• A)the taxpayer's expertise in the activity
• B)the taxpayer's financial status
• C)the personal pleasure derived from the activity
• D)the business success of the taxpayer in other dissimilar businesses

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Definitions:

Monopsony Power

A market condition where there is only one buyer for a product or service, giving that buyer considerable control over prices.

Professional Athletes

Individuals who compete in sporting activities at the highest level and receive payment for their performance and participation.

Professional Sports

Sporting activities or events where athletes receive payment for their performance, as opposed to amateur sports where athletes do not receive financial compensation.

Real Income

Income adjusted for price changes.