Which of the Following Should Increase the Likelihood That Mr

question 39

Multiple Choice

Which of the following should increase the likelihood that Mr. and Mrs. McNut's Form 1040 will be selected for audit by the IRS?

• A) Mrs. McNut is an employee of the federal government.
• B) The McNuts claimed two additional standard deductions because they are both over age 65.
• C) The McNuts excluded $7,705 interest earned on a City of Pittsburg municipal bond from their gross income.
• D) The McNuts reported a $22,600 nonbusiness bad debt for a loan to their grandchild as a capital loss on Schedule D.

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Definitions:

Weekend Getaway

A short trip taken for leisure, typically over a weekend period, to relax and escape from routine.

Inverse Demand Curve

A graphical representation showing the relationship between the price of a good and the quantity demanded, where the price is on the vertical axis and quantity on the horizontal axis.

Marginal Costs

The extra expense associated with manufacturing an additional unit of a product or service.

Price Discrimination

A pricing strategy where a seller charges different prices for the same product or service to different customers, based on their willingness to pay.