4.

Security Returns if State Occurs State of Economy Bust Boom Probability of State of Economy 0.40 0.60 Roll -15% 22 Ross 15% 5 Calculate the expected returns for Roll and Ross by filling in the following table: (A negative value should be indicated by a minus sign. Do not round intermediate calculations. Calculate the product using the decimal value of the probability and the percentage value of the return. Input all your answers as a percent rounded to 2 decimal places.) Roll Ross State of Economy Return if State Occurs Product Probability of State of Economy 0.40 Return if State Occurs Product Bust % (15) % 22 % Boom 0.60 15 % 5 % E(R)=S E(R)= 7.20 % 9.00 %