In this book, we do not consider taxes and their impact on return in detail, but let
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In this book, we do not consider taxes and their impact on return in detail, but let us assume that we are subject to a tax rate t on the capital growth. This means that the nominal after-tax return rate is . Using the approximation of Eq. (3.21), the real after-tax return is
The product term intint shows how tax and inflation rates compound in reducing the real increase of wealth.
Data From Equation (3.21)
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An Introduction To Financial Markets A Quantitative Approach
ISBN: 9781118014776
1st Edition
Authors: Paolo Brandimarte
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