Assume There Are Only Three Possible States of Nature for the Economy

question 57

Multiple Choice

Assume there are only three possible states of nature for the economy in the future: boom,normal,and recession.If there is a 25% chance of a recession and a 30% chance of a boom,then what is the probability of a normal economy in the future?

• A) 45%
• B) 30%
• C) 25%
• D) 100%

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