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unrendezvous unrendezvous
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5 months ago
You have done a thorough study of the economy and of Stock X and concluded the following probabilities:
•having a boom next year is 20.0%
•having a stable economy is 55.0%
•having a recession is 25.0%.
You have also found the price of Stock X will be:
•$45 if there is a boom
•$25 if the economy is stable
•$15 if there is a recession.
What is the ex ante expected return on Stock X if it is currently selling for $24?

▸ 26.50%

▸ -9.43%

▸ 10.42%

▸ 18.06%
Textbook 
Corporate Finance

Corporate Finance


Edition: 5th
Author:
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apinaapina
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5 months ago
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