Question: While evaluating a stock, you estimate that it will earn a return of 1 4 peicent if economic condsons are fiverabie, and if percent If

While evaluating a stock, you estimate that it will earn a return of

14

peicent if economic condsons are fiverabie, and if percent If economic conditions are unfevorable Given the probabities of fevorable versus unfruorabie economk condibons. you conclude that the Hock wil earn

9

percent neat year. The

19

pencent flgure is called the

While evaluating a stock, you estimate that it

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