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You recently purchased a stock that is expected to earn 12 percent in a booming economy, 7 percent in a normal economy and lose 4

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You recently purchased a stock that is expected to earn 12 percent in a booming economy, 7 percent in a normal economy and lose 4 percent in a recessionary economy. There is a 16 percent probability of a boom, a 75 percent chance of a normal economy. What is your expected rate of return on this stock? 6.81 5.57 7.53 4.00 O 7.01

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