Steve Goes to Tri-State University and Pays $40,000 in Tuition

question 89

Multiple Choice

Steve goes to Tri-State University and pays $40,000 in tuition.Steve works a part-time job to pay for his schooling and has an AGI of $17,000.How much is his American Opportunity tax credit?

• A)$2,000
• B)$2,500
• C)$4,000
• D)$1,000
• E)He does not qualify for the American Opportunity tax credit.

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Definitions:

Marginal Revenue

The additional income received from selling one more unit of a good or service.

Demand Curve

A graph showing the relationship between the price of a good and the quantity of the good that consumers are willing and able to purchase at various prices.

Elasticity

A measure of how much the quantity demanded or supplied of a good responds to a change in one of its determinants, such as price.

Inferior Goods

Goods for which demand decreases as the income of the consumer increases, opposite to normal goods.