Alan Has the Following Capital Gains and Losses During the Current

Alan has the following capital gains and losses during the current year:
$\begin{array}{lc}\text { Short-term capital loss } & \$(4,000) \\\text { Collectibles gain } & 3,000 \\\text { Long-term capital gain } & 8,000\end{array}$
If Alan's marginal tax rate is 33%,what is the effect of the capital gains and losses on his taxable income and income tax liability?
$\begin{array}{cl}&\text { Income } & \text { Tax Liability } \\a.&\$ 7,000 \text { increase } & \$ 2,310 \text { increase } \\b.&\$ 8,000 \text { increase } & \$ 1,840 \text { increase } \\c.&\$ 7,000 \text { increase } & \$ 1,400 \text { increase } \\d.&\$ 8,000 \text { increase } & \$ 1,200 \text { increase } \\e.&\$ 7,000 \text { increase } & \$ 1,050 \text { increase }\end{array}$