Pete, the owner of a very successful coffee chain in Nevada, is exploring the possibility of expanding the coffee chain into California. In 2016, Pete incurs $32,000 of expenses associated with this investigation. Based on the high demand for coffee in California, Pete decides to expand to California. He opens a shop in San Francisco, California on October 1, 2016. In addition, Pete, who is not currently involved in the gas station business, spends $23,000 in 2016 investigating the acquisition of a gas station in Nevada. Pete's research suggests that it would not be a good business decision as acquisition costs would be high and electric vehicles are expected to greatly reduce demands for gas stations. He does not acquire the gas station. What amount can Pete deduct in 2016 for the expenses incurred in investigating the expansion of his coffee chain and investigating the acquisition of the gas station