Four probable states of the economy may prevail next year, Ask an Expert

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Four probable states of the economy may prevail next year. Below are the returns on the stocks of ABC and XYZ companies under each of the probable states and the probabilities for each state. State of Economy Probability ABC Stock XYZ Stock Severe Recession 15.00% 10.00% -5.00% Mild Recession 30.00% 8.00% -2.00% Slow Growth 35.00% -4.00% 11.00% Moderate Growth 20.00% -8.00% 22.00% Given the probabilities for the four possible economic conditions, calculate the expected return for ABC stock. (Enter your answer as a percentage, not in decimal form. E.g. 15% should be entered as 15.00 and not as 0.15)

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M91771949

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