You recently purchased a stock that is expected to earn 12% in a booming economy, 8% in a normal economy and lose 10% in a recessionary economy. There is a 15% probability of a boom, a 75% chance of a normal economy, and a 10% chance of a recession. What is your expected rate of return on this stock?

	A.	5.00%
	B.	6.80%
	C.	7.30%
	D.	7.88%
	E.	8.30%

Risk that affects at most a small number of assets is called _____ risk.

	A.	portfolio
	B.	undiversifiable
	C.	market
	D.	unsystematic
	E.	total

Which of the following would be considered an example of systematic risk?

	A.	Apple wins its law suit against Samsung.
	B.	Quarterly profit for GM equals expectations.
	C.	Lower quarterly sales for IBM than expected.
	D.	Greater new jobless claims in the economy than expected.
	E.	The CEO at Hewlett-Packard announces his resignation.