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Private Equity

Lecture 1-2: PE Introduction

Comprehensive exam-prep quiz based on the lecture on private equity, LBO basics, market conditions, PE jobs, investment process, due diligence, and useful terms. Source:

Question 11 of 69

Put the carried-interest distribution waterfall phases in the correct order.

Drag the steps into the correct order. You can also use the arrow buttons.

Order the process: arrange every step from first to last, then check your answer.
1

LPs receive distributions until they have recovered their original investment and the annual return equivalent to the hurdle rate.

2

Remaining profits are split 80% to LPs and 20% to the GP.

3

The GP receives 100% during the catch-up phase until the split between LP and GP is 80/20.