stockjaguar

had to get out of the house. somehow, this is my fault, this thread got confusing. i’m not actually sure that florin and i are even disagreeing.
at the risk of making it more confusing.
say you have an after tax required return, that has not included an inflation component. say 4% is the after tax requirement. tax rate is 20%.
so your pretax return requirement is 5%.
if inflation is 2%, you are saying you would go,
(4%+ 2%)/.8 = 7.5%?
and i would go, 4%/.8 = 5% then add 2% inflation to get 7%.
is this what we are saying?