Kim Dies Owning a Passive Activity with a Basis of $75,000

question 38

True/False

Kim dies owning a passive activity with a basis of $75,000, a fair market value of $140,000, and suspended losses of $80,000.All of the $80,000 passive activity loss can be deducted on Kim's final income tax return.

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Definitions:

Income Elasticity

A measure of how the demand for a good or service changes in response to a change in consumers' income.

Quantity Demanded

The total amount of a good or service that consumers are willing and able to purchase at a given price in a specified period of time.

Normal Good

A good or service whose consumption increases when income increases and falls when income decreases, price remaining constant.

Elasticity of Demand

A measure of how much the quantity demanded of a good responds to a change in the price of that good, signifying how the demand for a good can stretch or change.