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What is the risk premium for the following returns if the risk-free rate is 1%? State Probability Return Boom .05 15% Good .40 10% Recession

What is the risk premium for the following returns if the risk-free rate is 1%? State Probability Return Boom .05 15% Good .40 10% Recession .30 -4% Depression .05 -7% A) 3.2% C) 5.7% B) 2.2% D) 2.5%

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