Question: Question 1 Scenario analysis for Stocks X and Y: Bear Market Normal Market Bull Market Probability 0.2 0.5 0.3 Stock X 20% 18% 50% Stock

Question 1

Scenario analysis for Stocks X and Y:

Bear Market

Normal Market

Bull Market

Probability

0.2

0.5

0.3

Stock X

20%

18%

50%

Stock Y

15%

20%

10%

(1) What are the expected rates of return for Stocks X and Y?

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