A company stock is expected to lose 5.0 percent in a booming economy, earn 12.5 percent in a normal economy, and earn 2.0 percent in a recession. The probability of a boom is 13.5 percent while the probability of a normal economy is 70 percent. What is the expected rate of return on this stock?

Group of answer choices

8.41%

2.89%

3.17%

7.01%