Compute the Expected Return Given These Three Economic States, Their

question 10

Multiple Choice

Compute the expected return given these three economic states, their likelihoods, and the potential returns: $$\begin{array} { | l | c | r | } \hline \begin{array} { l } \text { Economic } \\\text { State }\end{array} & \text { Probability } & \text { Return } \\\hline \text { Fast Growth } & 0.1 & 50 \% \\\hline \text { Slow Growth } & 0.6 & 8 \% \\\hline \text { Recession } & 0.3 & - 10 \% \\\hline\end{array}$$

• A)6.8 percent
• B)12.8 percent
• C)16.0 percent
• D)22.7 percent

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Definitions:

Bill of Rights

The first ten amendments to the United States Constitution, guaranteeing specific freedoms and rights to American citizens.

Commerce Clause

A provision in the U.S. Constitution granting Congress the power to regulate trade between states and with foreign nations.

Interstate Commerce

Commercial transactions or movement of goods and services across state borders, regulated by federal law in the United States.

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The power of courts to assess the constitutionality of laws or government actions.