A high-water mark of $150 million was established two years ago for Sarah hedge fund. The end-of-year value before fees for last year was $140 million. This year’s end-of-year value before fees is $158 million. The fund charges “1 and 15.” Management fees are paid independently of incentive fees and are calculated on end-of-year values. Its total fee paid this year is closest to A. $2.3 million. B. $2.8 million. C. $3.1 million. D. $4.1 million.

A high-water mark of $150 million was established two years ago for Sarah hedge fund. The end-of-year value before fees for last year was $140 million. This year’s end-of-year value before fees is $158 million. The fund charges “1 and 15.” Management fees are paid independently of incentive fees and are calculated on end-of-year values. Its total fee paid this year is closest to A. $2.3 million. B. $2.8 million. C. $3.1 million. D. $4.1 million.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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