You recently purchased a stock that is expected to earn 12.6 percent in a booming economy, 8.9 percent in a normal economy and lose 5.2 percent in a recessionary economy. Each economic state is equally likely to occur. What is your expected rate of return on this stock?

Answer rating: 100% (QA)

The expected rate of return on the stock is 543 This is calculated by considering the probabili... View the full answer