Noelle Owns an Automobile Which She Uses for Personal Use

question 117

Multiple Choice

Noelle owns an automobile which she uses for personal use. Her adjusted basis is $45,000 (i.e., the original cost) . The car is worth $22,000. Which of the following statements is correct?

• A) If Noelle sells the car for $22,000, her realized loss of $23,000 is not recognized.
• B) If Noelle exchanges the car for another car worth $22,000, her realized loss of $23,000 is not recognized.
• C) If the car is stolen and it is uninsured, Noelle will not be able to recognize part of her realized loss of $23,000.
• D) Only a. and b. are correct.
• E) a., b., and c. are correct.

Apply the concepts of marginal cost and marginal benefit to determine the optimal level of resource allocation for public goods.

Understand the concepts of externalities and how they impact the efficient provision of public goods.

Recognize the principal-agent problem in corporations and its implications for corporate governance.

Evaluate the effectiveness of crime control programs through cost-benefit analysis.

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Definitions:

Hypothalamus

A structure in the forebrain that controls the pituitary gland and so-called homeostatic behaviors such as eating, drinking, temperature control, sleeping, sexual behaviors, and emotional reactions.

Thalamus

A brain structure that acts as a relay station, processing and transmitting information from the senses to the appropriate areas of the brain.

Medulla

A structure in the hindbrain that transmits information from the spinal cord to the brain and regulates life support functions such as respiration, blood pressure, coughing, sneezing, vomiting, and heart rate.

Cerebellum

A part of the brain located at the back of the skull, responsible for coordinating voluntary movements and maintaining balance.