What Is the Expected Return on This Stock Given the Following

question 45

Multiple Choice

What is the expected return on this stock given the following information?
$\begin{array}{lcc}\text { State of the Economy } & \text { Probability of } & \text { Rate of Return if } \\& \text { State of Economy } & \text { state occurs }\\\text { Boom } & .05 & 16 \% \\\text { Normal } & .45 & 7 \% \\\text { Recession } & .50 & -12 \%\end{array}$

• A)2.05%
• B)1.08%
• C).47%
• D)1.22%
• E)1.43%

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Definitions:

Social Construction

The concept that many beliefs, identities, and values are created and maintained through social interactions and societal norms rather than inherent.

Culture

The complex blend of values, beliefs, behaviors, and material objects that form a people's way of life.

Cohort

A group of people banded together or treated as a group.

Genetic Analysis

The study of DNA, genes, and their functions, aiming to understand genetic diseases, heredity, and traits.