Private wealth mgmt :Return requirement
I have a question about Private wealth mgmt book 2 of CFAI. Q 2 on page 207 where Christa return requirment is calculated. In the solution it says “Because the portfolio’s expected retun of 7.4% translates to real retun of 4.4 %, the portfolio is not expected to meet the return requirment of 4.5%”
But both the returns of 7.4% and 4.5% were calculated the same way without adjusting for inflation, so my question is why the 7.4% return is adjusted for inflation and then compared with the 4.5% retrun which was calculated the same way as 7.4%?? the only difference is that Chrits reduces her living expenses by combining studio and apart? we are comparing apples with oranges
82,500/1,120,000 =7.4%, this is then adjusted for inflation?
50,000/1,120,000 = 4.5%
Thanks |
发表于 2013-4-28 12:51
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