1. Considering the world economic outlook for the coming year and estimates of sales and earning for the pharmaceutical industry, you expect the rate of return for Lauren Labs common stock to range between 20 percent and +40 percent with the following probabilities.

Probability	Possible Returns
.10	-.20
.15	-.05
.20	.10
.25	.15
.20	.20
.10	.40

Compute the expected rate of return E(Ri) for Lauren Labs.