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MM Mock Exam 3 AM Question 7-C

If you guys have this mock, I got to 102,000/13,338,000 = .0076. How come we don’t increase this amount by inflation, THEN increase by taxes?

The answer uses .0076 as after tax real return.

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I believe that you don’t increase it for taxes because it asked for the after-tax return

I could be mistaken.

Simplify the complicated side; don't complify the simplicated side.

Financial Exam Help 123: The place to get help for the CFA® exams
http://financialexamhelp123.com/

I apologize for this dumb question, I was blind. Thank you!

My pleasure.

Simplify the complicated side; don't complify the simplicated side.

Financial Exam Help 123: The place to get help for the CFA® exams
http://financialexamhelp123.com/

One more question on this - why don’t we subtract the current year living expenses in T-1 when calculating the end of current year portfolio value?

Because the author naïvely assumed that the candidates would realize that the gentleman had held back enough to cover his living expenses before he deposited USD 8.5 million into his portfolio.

The updated vignette makes that position explicit.

Simplify the complicated side; don't complify the simplicated side.

Financial Exam Help 123: The place to get help for the CFA® exams
http://financialexamhelp123.com/

is there any errata pdf about this 4 mock i can get ? thanks

"You could not live with your own failure. Where did that bring you? Back to me." (Thanos - Endgame)

I’m told that there are.

I haven’t access to them.

Simplify the complicated side; don't complify the simplicated side.

Financial Exam Help 123: The place to get help for the CFA® exams
http://financialexamhelp123.com/

S2000magician wrote:

Because the author naïvely assumed that the candidates would realize that the gentleman had held back enough to cover his living expenses before he deposited USD 8.5 million into his portfolio.

The updated vignette makes that position explicit.

Got it. Thanks!