1. Explain the differences between taxable income and adjusted gross income.

2. In your own words, define tax deduction, exemption, and tax credit.

3. What is the NPV of $100 received in 1 year, 400 received in 2 years and 600 received in 3 years when the interest rate is 10%? (Express your answer in dollars and cents. Do not put the $ symbol)

4. The local government is running a flu vaccination program. Are the following costs fixed, variable, or step costs?

(a) Costs of occupancy

(b) Costs of management

(c) Costs of part-time employee salaries based on service volume

(d) Costs of vaccine consumed