With all the data in this question, why didn’t they calculate the required return rather than just state some general stuff about the required return for these clients? I’m starting to think that the actual calculation will not be on the exam but rather general concepts on the objectives and constraints.
PJ - that one was a bit wordy. In my answer I think I said like $40k/$550 = 7.27%. [I know, I didnt inflation adjust and taxes and all that schiznit]. I would work under the impression that you should provide a calc (they may ask) - you know enough to get mucho partial points if needed.