4. Performance Fee (LO2, CFA2) Assume Cambridge Ventures raises $10,000,000 for a private equity fund with a

Question:

4. Performance Fee (LO2, CFA2) Assume Cambridge Ventures raises $10,000,000 for a private equity fund with a one-year life. The fund has a hurdle rate of 6 percent, above which it earns a carried interest of 20 percent. If Cambridge generates a return of 18 percent, what is the firm’s carried interest for the year?

Fantastic news! We've Found the answer you've been seeking!