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Mr. Ali has $10,000 in his savings account. He requires $10,000 for a vacation and $10,000 to invest in gold coins. He plans to borrow

Mr. Ali has $10,000 in his savings account. He requires $10,000 for a vacation and $10,000 to invest in gold coins. He plans to borrow the extra $10,000 from his bank and hopes the interest expense will be tax deductible. Mr. Basil should: (3 marks)

A.

Use the bank loan to fund his vacation

B.

Use the bank loan to fund his gold coin investment

C.

Either action will allow an interest expense deduction

D.

Neither action will allow an interest expense deduction

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