You invested $5,000 in a stock and kept it for 4 years when you sold it for $5, 500. The company paid you the following dividends annually: $237, $175, $203 and $116 in years 1 through 4, respectively. The average inflation during this period is 5% per year.

Prepare a table to show the inflation-adjusted, after tax cash flow. Assume that you are already in the 28% income tax bracket.

Assume that capital gain loss is taxed at 15% You bought a house for $300,000 for investment purposes with the intention of selling it after 5 years.

You hope to earn a 4% before-tax, inflation adjusted rate of return.

What should be the selling price of the house if the average inflation rate over this time period is 3%? Show all calculations