Your firm has created two equity baskets. One is procyclical, and the other is countercyclical. The procyclical

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Your firm has created two equity baskets. One is procyclical, and the other is countercyclical. The procyclical basket has a 75% probability of being up in years when the economy is up, and a 25% probability of being up when the economy is down or flat. The probability of the economy being down or flat in any given year is only 20%. Given that the procyclical index is up, what is the probability that the economy is also up?

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