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QUESTION 16 A risk-free investment of $50,000 offers an annual return of 8%. A risky investment of $50,000 has a 40% probability of default, in
QUESTION 16 A risk-free investment of $50,000 offers an annual return of 8%. A risky investment of $50,000 has a 40% probability of default, in which case it will pay only $25,000. Refer to the information above. What return must the risky investment promise? A. 54.78% B. 37.45% C.46.67% D.33.33%
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