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Awuah is thinking about investing in the stock market. He has the following three stocks in mind. Stock A, B, and C. He understands that
Awuah is thinking about investing in the stock market. He has the following three stocks in mind. Stock A, B, and C. He understands that the economy could be in a state of recession, normal, boom, or in depression. He also estimates a likelihood of each scenario been identical. The possible return on each is given below
State of the economy | A | B | C |
recession | 10% | 20% | 5% |
normal | 30% | -12% | 5% |
boom | 50% | 9% | 13% |
depression | -20% | 5% | -5% |
What are the expected returns for stock A, B, and C respectively
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