Given the Expected Returns and Probabilities of Various States of the World

question 20

Multiple Choice

Given the expected returns and probabilities of various states of the world in this table,what is the expected return for Dancine Company? Dancine Company $$\begin{array} { | l | c | c | } \hline \text { State of the Economy } & \text { Probability of State } & \text { Return on State } \\\hline \text { Boom } & .30 & 18 \% \\\hline \text { Steady } & .55 & 10 \% \\\hline \text { Recession } & .15 & - 5 \% \\\hline\end{array}$$

• A)9.45%
• B)12.40%
• C)10.15%
• D)-0.75%

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Definitions:

Instincts

Innate, biologically determined behavioral responses characteristic of a species, often triggered by specific external stimuli.

Sense of Attachment

The emotional bond that forms between individuals, often starting from infancy, that affects their relationships throughout life.

Life Instincts

In psychoanalytic theory, the innate drives that contribute to survival, growth, and creativity, as opposed to death instincts which relate to aggression and self-destructive behaviors.

Organismic Valuing Processes

Internal evaluative processes through which individuals judge experiences in terms of their value for fostering or hindering their own growth and development.