What rate of return must it earn in the second year

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Reference no: EM131622203

A hedge fund charges an incentive fee of 10% of any investment returns 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.) Please show how to do calculations.

Reference no: EM131622203

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