How much Algebraic Geometry should one know at the beginning of grad school?

Question

I'm a Canadian undergraduate planning to focus on Algebraic Geometry. In Canada a Masters is typically completed before a PhD, though I'm also open to school elsewhere, and I know some places you jump right into PhD.
I recently grabbed a copy of Hartshorne and have started reading/working through problems, and have Vakil's note on my laptop.
Where is my knowledge of Algebraic Geometry expected to be at the beginning of a Masters? or PhD? In Vakil's suggestions to potential PhD students, he suggests completing most of the exercises in Hartshorne before becoming his student.
I was planning on doing the first 3 chapters by the time I start my Masters/PhD in a about a year and a half. Is that possible? Reasonable? Will this give me an edge, or is it the bare minimum for preparation?