Question 6 of Schweser Practice exam 2 morning session to calculate the spending rate, shouldnt you have to determine the amt of pre tax spending required? in this case would be 200,000 rather than the 150K after tax we are trying to calc the before tax return, and the investor would need to be able to fund 200K pre tax?
Not sure where you’re getting confused - they calculate the after tax spending requirements, increase that by the expected inflation, and then they get the before tax return needed. The only part that kinda threw me for a loop was calculating the before tax amount at the end (after calculating the inflation numbers), but I can now understand why they did that. Read the entire explanation on page 248 - it’s pretty clear.