Matthew paints landscape portraits, and he treats the activity as a hobby. During the current year, Matthew incurred the following expenses while earning S3.200 from sales of paintings: Paints and supplies $2,200 Utilities expenses for his 1,000 studio Advertising 300 Insurance on his studio and 700 equipment Matthew uses the standard deduction and never itemizes his deductions. How will the activity from this hobby affect Matthew's taxable income? a) Increase taxable income by $2,500 b) Increase taxable income by $3,200 c) No effect on taxable income