During the current year, Mr. Jones made gifts to his son of the following items: A minivan with an adjusted basis of $15,000 and fair market value of $17,000. Bonds with an adjusted basis of $7,000 and fair market value of $19,000. Antique furniture with an adjusted basis of $15,000 and a fair market value of $38,000. An interest-free $10,000 loan on January 1 to buy a boat for his personal pleasure. His son repaid the loan in full on December 31. The applicable federal interest rate was 10%. Mr. and Mrs. Jones elect gift splitting. What is the total amount of their taxable gifts to their son in the current year

Suppose that a major city’s main thoroughfare, which is also an interstate highway, will be completely closed to traffic for two years, from january 2014 to december 2015, for reconstruction at a cost of $535 million. if the construction company were to keep the highway open for traffic during construction, the highway reconstruction project would take much longer and be more expensive. suppose that construction would take four years if the highway were kept open, at a total cost of $800 million. the state department of transportation had to make its decision in 2014, one year before the start of construction (so that the first payment was one year away). so the department of transportation had the following choices: (i) close the highway during construction, at an annual cost of $267.5 million per year for two years. (ii) keep the highway open during construction, at an annual cost of $200 million per year for four years. now suppose the interest rate is 80%. calculate the present value of the costs incurred under each plan.