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1 Compute the expected return given these three economic states, their likelihoods, and the potential returns: (Round your answer to 2 decimal places.) 5 point

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1 Compute the expected return given these three economic states, their likelihoods, and the potential returns: (Round your answer to 2 decimal places.) 5 point Economic State Fast growth Slow growth Recession Probability Return 0.32 42% 0.34 19 0.34 -16 Print Expected retum Befence A corporate bond that you own at the beginning of the year is worth $850. During the year, it pays $40 in interest payments and ends the year valued at $840. What was your dollar return and percent return? (Round "Percent return" to 2 decimal places.) Dollar return Percent return % Table 9.2 Average Returns for Bonds 1950 to 1959 Average 1960 to 1969 Average 1970 to 1979 Average 1980 to 1989 Average 1990 to 1999 Average 2000 to 2009 Average Long-Term Treasury Bonds 0.0% 1.4 5.7 13.9 9.3 8.2 Table 9.4 Annual Standard Deviation for Bonds 1950 to 1959 1960 to 1969 1970 to 1979 1980 to 1989 1990 to 1999 2000 to 2009 Long-Term Treasury Bonds 4.6% 6.5 6.8 15.9 12.4 10.6 Use the tables above to calculate the coefficient of variation of the risk-return relationship of the bond market during each decade since 1950. (Round your answers to 2 decimal places.) Decade COV 1960s 1970s 1980s 1990s 20005

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