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Macmillan Learning Suppose that the price of some good has increased by 30% each year for the past few years. At this point, Bob the
Macmillan Learning Suppose that the price of some good has increased by 30% each year for the past few years. At this point, Bob the good is overpriced. The current price is $10,000, but he does not think it is actually worth more than $3,0 thinks that there is a 90% chance that the price will increase by 30% this year, with a 10% chance that the pric $3,000. If Bob's expectations are correct, what is the expected return, in percent from investing in the g terms, include a negative sign if the number is negative
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