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You recently purchased a stock that is expected to earn 22 percent in a booming economy, 12 percent in a normal economy, and lose 8
You recently purchased a stock that is expected to earn 22 percent in a booming economy, 12 percent in a normal economy, and lose 8 percent in a recessionary economy. The probability of a boom economy is 16 percent while the probability of a normal economy is 62 percent. What is your expected rate of return on this stock? 10.40 percent 7.5 percent 9.20 percent 9.80 percent Question 11 2 pts What the order of preference of pecking order theory? equity debt internal fund debt > internal fund equity equity internal fund debt Internal fund debt equity
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