Suppose that there are two possible states of the world next year: boom or recession. Suppose that we forecast the following probabilities of these states and the returns to two US stocks, CXW (Corrections Corp of America; a prison stock) and AMR (parent of American Airlines). What is the expected return on each stock? Give your answers to four decimal places.

STATE	Prob.	R(CXW)	R(AMR)
Boom	0.75	-0.1	0.25
Recession	0.25	0.1	-0.25

Choose the correct answer:

A.E[R(CXW)] = 0.1250; E[R(AMR)] = -0.0500

B.E[R(CXW)] = -0.0500; E[R(AMR)] = 0.1250

C.E[R(CXW)] = 0.0000; E[R(AMR)] = 0.0000

D.E[R(CXW)] = 0.0500; E[R(AMR)] = -0.1250

E.E[R(CXW)] = 0.1000; E[R(AMR)] = 0.2500

F. E[R(CXW)] = -0.0500; E[R(AMR)] = -0.0500

G.This queston does not have an economically sensible answer.

H.None of the above is correct.