A hedge fund manager charges a management fee of 2.3% each year & an incentive fee of 13% on net new profits (surpassing the previous high-water mark) earned by the fund after deducting the management fee. All fees are collected @ the end of the year.The gross returns for the past three years are +22% for year 1, -8% for year 2, and +7% for year 3.

a. If the fund is at its high-water mark at the start of year 1, what's the total net return to investors for the fund over the 3-year period?

b. How much total fees did the manager collect for the 3 years as % of the initial investment?

c. What's the effective annualized net return to investors for the 3-year period.

d. How much should the fund appreciate in the 4th year in order to allow the manager to start charging the incentive fee again?