Assume a hedge fund has a fee structure of 4 plus 25%. What return is the hedge fund required to generate on the managed portfolio (before fees) if it is to provide investors with a return of 15% net of fees?

Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Eugene F. Brigham, Phillip R. Daves
Chapter2: Risk And Return: Part I
Section: Chapter Questions
Problem 10P
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Assume a hedge fund has a fee structure of 4 plus 25%. What return is the hedge fund required to generate on the managed portfolio (before fees) if it is to provide investors with a return of 15% net of fees?

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