mkytz15

There is such a thing as a soft hurdle (A) and a hard hurdle (B).
I think CFAI will take the simple general approach unless stated as a hard hurdle. If the GP can meet the set hurdle rate, s/he is entitled to 20% of the profits 135-100=35x.20= 7M. You are just using the set hurdle rate to test if they get carried interest or not, if they do, they get their %, if not, they get nothing..it all goes to the LP investors.
Be careful that if the GP also contributed money, they get 80% of the profits as part LP plus 20% carried interest as GP.
-Interpretation compliments of CAIA Program.