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You plan to invest $1 .000 in a corporate bond iund or in a common stock fund. The information to the right about the annual
You plan to invest $1 .000 in a corporate bond iund or in a common stock fund. The information to the right about the annual retum [per $1,000} of each of these investments under different economic conditions is available, along with the probability that each of these economic conditions will occur Complete parts (a) through (c) below. % Economic Corporate Common Probability Condition Bond Fund Stock Fund 0.01 Extreme recession 200 990 0.09 Recession 90 300 0.15 Stagnation 20 - 100 0.30 Slow growth 80 100 0.35 Moderate growth 90 150 0.10 High growth 110 350 on I. Compute the expected return for the corporate bond fund and for the common stock fund. The expected return for the corporate bond fund is [D (Round 10 two decimal places as needed.)
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