An Investor Owns a Security That Is Expected to Return

question 18

Multiple Choice

An investor owns a security that is expected to return 10 percent in a booming economy and 3 percent in a normal economy.The overall expected return on the security is 5.45 percent.Given there are only two states of the economy,what is the probability that the economy will boom?

• A) 28 percent
• B) 33 percent
• C) 35 percent
• D) 41 percent
• E) 45 percent

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Definitions:

Neurotransmitters

Chemicals released by nerve cells to transmit signals across a synapse to another nerve cell, muscle cell, or gland cell.

Synaptic Cleft

Space between the presynaptic and the postsynaptic membranes.

Postsynaptic Membrane

The part of the cell membrane of a neuron that is on the receiving end of a synapse, where neurotransmitter receptors are located.

Excitatory Postsynaptic Potential

A temporary increase in synaptic potential that makes a post-synaptic neuron more likely to generate an action potential.