Beth bought some residential development property for 200,000 five years ago. She sold the property this year for $1,200,000 and spent...

Beth bought some residential development property for 200,000 five years ago. She sold the

property this year for $1,200,000 and spent $250,000 for infrastructure development in year 5, the

year in which the property was sold. If the inflation rate for the past 5 years has been steady at 5%

annually, compute the after-tax real rate of return on this investment. Assume a capital gain tax of

15%.