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What is the expected return for the following stock? State Probability Return Average .55 .20 Recession .20 .10 Depression .25 -.20 0.055 = 5.50% 0.080
What is the expected return for the following stock?
State Probability Return
Average .55 .20
Recession .20 .10
Depression .25 -.20
0.055 = 5.50%
0.080 = 8.00%
0.095 = 9.50%
0.105 = 10.50%
0.110 = 11.00%
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