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Four analysts cover the stock of Fluorine Chemical. One forecasts a 66% return for the coming year. A second expects the return to be negative
Four analysts cover the stock of Fluorine Chemical. One forecasts a 66%
return for the coming year. A second expects the return to be negative 55%.
A third predicts a return of 1111%.
A fourth expects a 11%
return in the coming year. You are relatively confident that the return will be positive but notlarge, so you arbitrarily assign probabilities of being correct of 28 % comma28%,
8 %8%,
17 %17%,
and 4747%,
respectively, to theanalysts' forecasts. Given theseprobabilities, what is FluorineChemical'sexpected return for the comingyear?
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