Use the Table for the Question(s)below

question 53

Multiple Choice

Use the table for the question(s) below.
Consider the following probability distribution of returns for Alpha Corporation:
-Suppose an investment is equally likely to have a 35% return or a -20% return.The expected return for this investment is closest to:

• A)7.5%.
• B)15%.
• C)5%.
• D)10%.

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Definitions:

Actual Performance

The real or observed output, results, or productivity of an individual or organization, as opposed to expected or planned performance.

Historical

Pertaining to events, situations, or conditions from the past that are studied and considered significant.

Relative

A term describing something in comparison or relation to something else, considering its context or situation.

Engineering

The application of scientific, mathematical, and empirical principles and knowledge to innovate, design, develop, maintain, and improve structures, machines, devices, systems, materials, and processes.