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Risk Swan's Sportswear is conisering bringing out a line of designer joans After market research the firm has estab shed the expectations shown in the

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Risk Swan's Sportswear is conisering bringing out a line of designer joans After market research the firm has estab shed the expectations shown in the following table atout the annual rates of roturn D Use the table to calculate the average rotum for the line The average return for the lines 7%. (Entot as a percentage and found to two decimal places - X Data Table (Click on the con hon order to copy the contents of the datatable below into a spreadsheet Market acceptance Probability Annual rate of return Very poor 0.08 0.005 024 0.04 Ave 015 0075 Good 0.10 0.127 Excellent 0.07 21 The expected return, r is the average return that an investment is expected to produce over time. For an investment that has j different possible returns, the expected return is calculated as follows: == I x Pri = 1 where r = return for the th outcome Pr = probability of occurrence of the jth outcome n= number of outcomes considered OK

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