Question: What is the expected risk premium for the security? There are three states of the economy. The boom state has an associated probability of 0.2

 What is the expected risk premium for the security? There are

What is the expected risk premium for the security? There are three states of the economy. The boom state has an associated probability of 0.2 . The normal state of the economy has an associated probability of 0.4 . The bust state of the economy has as as ated probability of 0.4 . The rate of return in the boom state of the economy is 15%. The rate of return in the normal state of the economy is 8%. The rate of return in the bust state of the economy is 6%. The risk-free rate is 3.5%. 5.1% 8.6% 29% There isn't enough information to determine

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