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Q2) There is a 14.60% probability of an average economy and a 85.40% probability of an above average economy. You invest 48.40% of your money
Q2) There is a 14.60% probability of an average economy and a 85.40% probability of an above average economy. You invest 48.40% of your money in Stock S and 51.60% of your money in Stock T. In an average economy the expected returns for Stock S and Stock T are 10.90% and 10.50%, respectively. In an above average economy the the expected returns for Stock S and T are 10.70% and 27.70%, respectively. What is the expected return for this two stock portfolio? (2 points)
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