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CHAPTER 11 Risk and Retur 6. Calculating Expecte bleulating Expected Return. Based on the following information, calculate thPlease show work that is not on excel please. Thank you.

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Answer #1
Expected return      0.1275
Working;
State of economy Probability Rate of return
a b c=a*b
Recession           0.15         -0.09     -0.0135
Normal           0.60           0.11      0.0660
Boom           0.25           0.30      0.0750
Expected return      0.1275
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