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Starlight, Inc. must choose between two asset purchases. The annual rate of return and related probabilities given below summarize the firm's analysis.
Asset A Asset B
Rate of Return Probability Rate of Return Probability
8% 40% 7% 30%
13% 50% 17% 50%
18% 10% 27% 20%

For each project compute: The expected rate of return.

 

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