Question: While evaluating a stock, you estimate that it will earn a return of 14 percent if economic conditions are favorable, and 1 percent if economic

While evaluating a stock, you estimate that it will earn a return of 14 percent if economic conditions are favorable, and 1 percent if economic conditions are unfavorable. Given the probabilities of favorable versus unfavorable economic conditions, you conclude that the stock will earn 9 percent next year. The 9 percent figure is called the: Multiple Choice arithmetic return. historical return. expected return. geometric return. required return

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