Question: #24 A stock is expected to return 11% in a normal economy, 19% if the economy booms, and lose 8% if the economy moves into

#24

A stock is expected to return 11% in a normal economy, 19% if the economy booms, and lose 8% if the economy moves into a recessionary period. Economists predict a 65% chance of a normal economy, a 20% chance of a boom, and a 15% chance of a recession. What is the expected return on the stock? 8.65% 10.98% 9.75% 11.10%

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