Nominal Return error?: Schweser BK1: 2AM Q1 something, practice, therefore, another, increase

king_kong

Yep I'm in the slow lane with the mocks/practice papers.

Could use some input here with Q1 Exam 2 AM

Salary not indexed so no increase
Costs increase with inflation (therefore 2% higher than last year)
116k/3.75m = 3.1%

Totally get all of that.

When Schweser add another 3% to that return requirement. Now I'm lost. Can't see this as an errata. What's going on? Am I missing something fundamental?

Thanks,

APP