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Calculate the expected return for Stock B. State of Economy Prob. of State Stock A Return Stock B Return Recession .20 5% -17% Normal .55

Calculate the expected return for Stock B.

State of Economy	Prob. of State	Stock A Return	Stock B Return
Recession	.20	5%	-17%
Normal	.55	8%	12%
Boom	.25	13%	29%

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