John Has $55,000 Net Earnings from a Sole Proprietorship

question 97

Multiple Choice

John has $55,000 net earnings from a sole proprietorship.John is also employed by a major corporation and is paid $25,000.John's self-employment tax (rounded) for 2013 is

• A)$3,886.
• B)$4,208.
• C)$7,771.
• D)$8,415.

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Definitions:

Efficient Scale

The level of production at which average total costs are minimized.

Elasticity Of Demand

Elasticity of demand measures how the quantity demanded of a good changes in response to changes in its price.

Advertising

The activity or profession of producing advertisements for commercial products or services, aiming to influence consumer behavior.

Monopolistic Competition

A market structure characterized by many firms selling products that are similar but not identical, allowing them to have some control over their prices.