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Consider the following investment: A portfolio that pays a 3 0 % rate of return with a probability of 6 0 % or a 1

Consider the following investment: A portfolio that pays a

30 %

rate of return with a probability of

60 %

or a

15 %

rate of return with a probability of

40 % .

If you invest $

50, 000

in this portfolio, what would be your expected profit?

portfolio return

w_{1} * * r_{1} + w_{2} * * r_{2}

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