Roger Is Considering Making a $6,000 Investment in a Venture

question 22

Multiple Choice

Roger is considering making a $6,000 investment in a venture that its promoter promises will generate immediate tax benefits for him.Roger, who does not anticipate itemizing his deductions, is in the 30% marginal income tax bracket.If the investment is of a type that produces a tax credit of 40% of the amount of the expenditure, by how much will Roger's tax liability decline because of the investment?

• A)$0
• B)$1,800
• C)$2,200
• D)$2,400
• E)None of these.

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Definitions:

Margin of Error

An expression of the amount of random sampling error in a survey's results, which indicates the precision of the estimates.

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Confidence Estimate

A range or value that reflects the degree of certainty, or confidence, about a particular statistical parameter.

Margin of Error

A measure of the precision of a survey's results, representing the extent to which the survey results might differ from the actual population value.