Use the imputed interest on below market loan rules to determine whether the lender must report interest on the following loans. Please pick the correct answers for each problems and explain why you pick the answers.

1) Corporation makes a $90,000 interest-free loan to shareholder for one year. Shareholder has $200 net investment income. The federal rate is 6%.

a) No Interest

b) Interest Limited to the Interest Amount of Borrower's Net at Federal Rate

c) Investment Income

2) Father makes a $75,000 interest-free loan to son for one year. Son has zero net investment income. The federal rate is 6%.

a) No Interest

b) Interest Limited to the Interest Amount of Borrower's Net at Federal Rate

c) Investment Income

3) Mother makes a $19,000 interest-free loan to daughter for one year. Daughter has $1,100 net investment income. The federal rate is 6%.

a) No Interest Interest

b) Limited to the Interest Amount of Borrower's Net at Federal Rate

c) Investment Income