If a firm with a $2 billion fund charges a 2 percent management fee for eight years,

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If a firm with a $2 billion fund charges a 2 percent management fee for eight years, and 20 percent carried interest on all profits, and earns a 3.0× return on its investments, what is the true multiple of investment and IRR for the LP? (Assume that investments are made equally at the beginning of the first through fifth years, the holding period of each investment is five years, and there are no transaction fees).

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