Emeril borrows $340,000 to finance taxable and tax-exempt investments. He incurs $18,000 investment interest expense, allocated equally between the taxable and tax-exempt investments. Ignore any possible investment interest expense limitation. How much of the interest expense is deductible, and where is it deductible? (Points : 4)

$18,000 for AGI $18,000 from AGI $9,000 for AGI $9,000 from AGI