Freedman Flowers' stock has a 50% chance of producing a 31% return, a 30% chance of producing a 17% return, and a 20% chance of producing a 40% return. What is the firm's expected rate of return?

Select the correct answer.

a. 12.67%

b. 12.74%

c. 12.60%

d. 12.81%

e. 12.88%