Rene Owns Four Small Businesses

question 54

Multiple Choice

Rene owns four small businesses.Rene spends the following number of hours this year working in those businesses: Business A,105 hours; Business B,130 hours; Business C,120 hours; Business D,99 hours.Which of the following statements is correct?

• A) Businesses A,B,and C are material participation activities.
• B) Businesses A,B,C,and D are all significant participation activities.
• C) Businesses A,B,and C are significant participation activities.
• D) Both Businesses A,B,and C are material participation activities and Businesses A,B,and C are significant participation activities are correct.

---

Definitions:

Disinflation

A decrease in the rate of inflation, indicating a slowdown in the rate at which prices for goods and services increase.

Rate of Inflation

The rise in the average cost of goods and services across an economy over a specific period.

Recessions

Periods of economic downturn when output and employment are falling, typically defined as two consecutive quarters of declining gross domestic product.

Consumer Price Index

An index that calculates the overall average price of a range of consumer goods and services, which includes transportation, food, and healthcare provisions.