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Assume the economy has a 65% chance of the market return will 18% next year and a 35% chance the market return will be 15%
Assume the economy has a 65% chance of the market return will 18% next year and a 35% chance the market return will be 15% next year. Assume the risk-free rate is 7%. If Microsofts beta is 1.3, what is its expected return next year?
Select one: A. 9.1%
B. 28.45%
C. 19.35%
D. 7%
E. 19.94%
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