$2.$ Use the following information for the problem.

$\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_$

State of Probability of Returns If State of Economy Occurs

Economy State of Economy Stock S Stock T

$\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_$

Boom $0\mathrm{.}200\mathrm{.}20($or $20\%)0\mathrm{.}05($or $5\%)$

Normal $0\mathrm{.}500\mathrm{.}10($or $10\%)0\mathrm{.}07($or $7\%)$

Recession $0\mathrm{.}300\mathrm{.}05($or $5\%)0\mathrm{.}15($or $15\%)$