Abigail's hobby is sculpting. during the current year, abigail sold three of her sculptures for a total of $3,200. her related expenses include $1,500 in utilities, $1,200 in supplies and $900 in depreciation. of the total expenses incurred, abigail may deduct

$1,500 in utilities, $1,200 in supplies and $500 in depreciation .

Explanation:

$1,500 in utilities, $1,200 in supplies and $500 in depreciation

 Since the activity is classified as a hobby, hobby expenses are deductible to the extent of hobby income of $3,200. Further, they are deducted in a specific order

those that are otherwise allowable such as property taxes and interest; those related to the activity other than those that decrease basis; and those that reduce basis (depreciation).

answer; is usually (less than) the socially optimal level of consumption;

a

explanation: