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The expected return of a stock, based on the likelihood of various economic outcomes, equals the: weighted average of the returns for each economic state.
The expected return of a stock, based on the likelihood of various economic outcomes, equals the:
weighted average of the returns for each economic state. | ||
return for the economic state with the highest probability of occurrence. | ||
highest expected return given any economic state. | ||
sum of the returns for each economic state. |
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