Calculate the net active return based on each possible gross active return provided using the selected data in Exhibit 1. Show your calculations.

Jack Porter and Melissa Smith are co-managers for the Circue Library Foundation (Circue) in Canada. Within the next six months, Porter and Smith will be replacing one of Circue’s underperforming active managers. This choice will rely on the terms of investment management contracts—specifically, liquidity and management fee structure. Circue’s IPS indicates some tolerance for lower liquidity, a moderate sensitivity to management fees, and a heightened sensitivity to closet indexing.

Circue is considering the following three investment vehicles with distinct fee structures:
• Hedge funds with a soft lock • Open-end funds with an incentive fee • Closed-end funds with no incentive fee

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Calculate the net active return based on each possible gross active return provided using the selected data in Exhibit 1. Gross Active Return 0.20% 0.75% 1.25% 1.75% Net Active Return Show your calculations.