Alternative Investments Q42

42Zee Capital, a hedge fund with an initial investment capital of $200 million had a 40% return in its first year. At year end, a 4% management fee is charged based on the assets under management and a 10% incentive fee is charged. The management fee is calculated using end-of-period valuation.
Which of the following is most likely to be the incentive fees earned?

Option : A
Explanation : Incentive Fee = (200 * 1.4 - 200) * 0.1 = $8 million.

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