Lets assume this is correct: ------------------------------------------------------- > It was 10.85 > > Short fall 45000 was not adjusted to inflation > > specifically said expenses would be 125000 on > retirement date (straight forward) > > portfolio value will have grown to 1.1M on > retirement date ( portfolio return figure was a > decoy because it was not needed) > > (45000/1000000)+1 *(1.04)-1 = 8.68 after tax > 8.68/0.8= 10.85. > > I believe that was the correct answer. I totally did this EXCEPT that I for some reason forgot the inflation!!! Do I get any points at all? How many?
It was a combination 12 point question: i. What is the return objective ii. Show your calculation
Yes, but how many points would it give (in % of max). 0%? 50%?
Not sure why you are finding pre-tax return. Didn’t they ask for after-tax return?