Consider a hedge fund with $250 million in assets at the start of the year. If the gross return on assets is 18% and the total expense ratio is 2.5% of the year-end value, what is the rate of return on the fund?

A) 15.05%
B) 15.5%
C) 17.25%
D) 18%

Question

Emily Kiessling · Accepted Answer

Final Answer : A, Explanation :  $250,000,000(1.18) = $295,000,0000.025(295,000,000) = $7,375,000   = 15.05%

Consider a hedge fund with $250 million in assets at the start of the year. If the gross return on assets is 18% and the total expense ratio is 2.5% of the year-end value, what is the rate of return on the fund?

A) 15.05%
B) 15.5%
C) 17.25%
D) 18%

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Consider a hedge fund with $250 million in assets at the start of the year. If the gross return on assets is 18% and the total expense ratio is 2.5% of the year-end value, what is the rate of return on the fund?A) 15.05%B) 15.5%C) 17.25%D) 18%

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Learning Objectives

Learning Objectives

Related questions

Consider a hedge fund with $250 million in assets at the start of the year. If the gross return on assets is 18% and the total expense ratio is 2.5% of the year-end value, what is the rate of return on the fund?

A) 15.05%
B) 15.5%
C) 17.25%
D) 18%