(a) (8 marks) A large US hedge fund has a value of $100 million at the beginning of the year. The fund charge

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(a)
(8 marks) A large US hedge fund has a value of $100 million at the
beginning of the year. The fund charges a 2% management fee based
on assets under management at the beginning of the year and a 20%
incentive fee with a 10% hurdle rate. Incentive fees are calculated
net of management fees. The value at the end of the year before
fees is $112 million.
Calculate the net return to investors.