A stock is expected to return 12% in a normal economy and -22% in a recession....

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A stock is expected to return 12% in a normal economy and -22% in a recession. There is a 55% probability of a recession. What is the expected return of this stock? A stock is expected to return 12% in a normal economy and -22% in a recession. There is a 55% probability of a recession. What is the expected return of this stock?

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Answer To calculate the expected return of the stock we need to take into account ... View the full answer