1. Phuong has the following sources of investment income:

Money market account interest	$2,000
Interest on State of New York bond	1,000
Dividends from domestic stocks	3,000
Long-term capital gain	4,000
Short-term capital gain	5,000

Barring any special elections, how much of the investment income will be included in calculating net investment income for purposes of the investment interest expense limitation

2. Nancy reports the following income and loss in the current year.

Salary	$ 60,000
Income from activity A	18,000
Loss from activity B	( 9,000)
Loss from activity C	( 13,000)

All three activities are passive activities with respect to Nancy. Nancy also has $21,000 of suspended losses attributable to activity C carried over from prior years. During the year, Nancy sells activity C and realizes a $15,000 taxable gain. What is Nancy's AGI as a result of these transactions?