Which of the Following Statements Regarding Health Savings Accounts Is

question 55

Multiple Choice

Which of the following statements regarding Health Savings Accounts is incorrect?

• A)Taxpayers are allowed to deduct contributions to a health savings account for AGI.
• B)All taxpayers are eligible to establish a health savings account.
• C)Distributions from a health savings account are excluded from gross income if used to pay qualified medical expenses.
• D)Health savings account contributions are limited to the lesser of 100% of annual deductible under a high-deductible health plan or $3,400 for taxpayers without family coverage.

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Definitions:

Marginal Revenue

The additional income gained from selling one more unit of a product or service.

Monopolist's Demand Curve

The demand curve faced by a monopolist, which is the same as the market demand curve, indicating that the monopolist can set the price only by choosing the quantity to produce.

Elastic

Describes a situation in which the demand or supply for a product changes significantly when its price changes.

Barriers

Obstacles that prevent or hinder entry into a market or the pursuit of certain activities, which can be economic, legal, technical, or natural in nature.