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Liqin fixes up old cars and sells them to supplement his retirement income. Liqin came across a beat-up 1955 Corvette that he is considering rebuilding and selling. He estimates a 0.2 probability that he will gain 15% on the deal, a 0.2 probability that he will gain 10%, and a 0.6 probability that he will gain 5%. What is Liqin's expected return for fixing up and selling the Corvette?
Operating Concern
A business enterprise that is functioning and not in the process of liquidation.
Liquidation
The process of winding up a company's affairs by selling off its assets to pay creditors and distribute any remaining assets to shareholders.
Pre-Tax Cost
Expenses or costs that are considered before taxes are applied.
Levered Value
The value of an investment, including the effects of borrowing; typically higher than the value without borrowing due to tax advantages and other factors.
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