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Suppose the government announces that, based on just-completed survey, the growth rate in the economy is likely to be 2 percent in the coming year,

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Suppose the government announces that, based on just-completed survey, the growth rate in the economy is likely to be 2 percent in the coming year, as compared to 5 percent for the year just completed. Will security prices increase, decrease, or stay the same following this announcement? Does it make any difference whether or not the 2 percent figure was anticipated by the market? Explain. Suppose the government announces that, based on a just-completed survey, the growth rate in the economy is likely to be 2 percent in the coming year, as compared to 5 percent for the year just completed. Explain why the market will increase, decrease or remain the same under this scenario in terms of risk and reward. Is the market rational or not

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