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Reed owns a stock that is expected to earn 8.7 percent in a booming economy, 9.2 percent in a normal economy, and 12.6 percent in

Reed owns a stock that is expected to earn 8.7 percent in a booming economy, 9.2 percent in a normal economy, and 12.6 percent in a recessionary economy. Each economic state is equally likely to occur. What is the expected rate of return on this stock? Multiple Choice 11.01% 9.98% 11.90% 10.17% 10.38%

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