Question
23. The returns of StarCups are 25% in economic boom, 10% in normal economics, and -5% in economic recessions. If the probabilities of economic boom,
23.
The returns of StarCups are 25% in economic boom, 10% in normal economics, and -5% in economic recessions. If the probabilities of economic boom, normal economics and economic recession are 40%, 35%, and 25% respectively. What is the expected return of StarCups?
| A. | 12.25% | |
| B. | 8.75% | |
| C. | 9.88% | |
| D. | 11.06% |
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Financial Management EMEA Theory And Practice
Authors: Michael Ehrhardt, Roland Fox, Eugene Brigham
2nd Edition
1473760216, 9781473760219
