(Related to Checkpoint 8.1) (Expected rate of return) James Fromholtz is considering whether to invest in a newly formed investment fund. The fund's investment objective is to acquire home mortgage securities at what it hopes will be bargain prices. The fund sponsor has suggested to James that the fund's performance will hinge on how the national economy performs in the coming year. Specifically, he suggested the following possible outcomes: : a. Based on these potential outcomes, what is your estimate of the expected rate of return from this investment opportunity? b. Would you be interested in making such an investment? Note that you lose all your money in one year if the economy collapses into the worst state or you double your money if the economy enters into a rapid expansion a. The expected rate of return from this investment opportunity is %. (Round to two decimal places) b. Would you be interested in making such an investment? (Select the best choice below.) O A. Your interest in making such an investment would depend on your risk tolerance. If you do not like risk you should avoid this investment, however if you do not mind risk you may want to make this investment OB. Yes, I would be inte O C. No, I would not be Data table State of Economy Probability Rapid expansion and recovery 5% Modest growth 35% Continued recession 55% Falls into depression 5% (Click on the icon in order to copy its contents into a spreadsheet.) Fund Returns 100% 30% 15% - 100% Print Done