A stock is expected to return 11% in a normal economy, 19% if the economy booms, and lose 8% if the economy moves into a
Posted: Sun May 29, 2022 6:29 pm
A stock is expected to return 11% in a normal economy, 19% if
the economy booms, and lose 8% if the economy moves into a
recessionary period. Economists predict a 65% chance of a normal
economy, a 25% chance of a boom, and a 10% chance of a recession.
What is the expected return on the stock? a. 11.10% b. 12.06% c.
11.98% d. 11.23%
Show working out.
the economy booms, and lose 8% if the economy moves into a
recessionary period. Economists predict a 65% chance of a normal
economy, a 25% chance of a boom, and a 10% chance of a recession.
What is the expected return on the stock? a. 11.10% b. 12.06% c.
11.98% d. 11.23%
Show working out.