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You recently purchased a stock that is expected to earn 30 percent in a booming economy, 9 percent in a normal economy, and l

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Answer #1

Ans 1.65 percent

Probability (P) RETURN (Y) (P * Y )
BOOM 5% 30 1.50
NORMAL 75% 9 6.75
RECESSION 20% -33 -6.60
TOTAL 1.65
Expected Return = (P * Y)
1.65%
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