The second year to be eligible for an incentive fee

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A hedge fund charges an incentive fee of 10% of any investment return above the T-bill rate, which currently is 1.5%. In the first year, the fund suffers a loss of 8.6%. What rate of return must it earn in the second year to be eligible for an incentive fee? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

Reference no: EM131621992

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