Expected return. Hull​ Consultants, a famous think tank in the​ Midwest, has provided probability estimates for the four potential economic states for the coming year. The probability of a boom economy is 13​%, the probability of a stable growth economy is 20​%, the probability of a stagnant economy is 54​%, and the probability of a recession is 13​%. Estimate the expected returns on the following individual investments for the coming year.

  Investment

Forecasted Returns for Each Economy

Boom Stable

Growth

Stagnant

Recession

  Stock

20​%

13​%

7​%

−10​%

  Corporate bond

10​%

8​%

6​%

3​%

  Government bond

9​%

7​%

5​%

2​%

​Hint: Make sure to round all intermediate calculations to at least seven​ (7) decimal places. The input​ instructions, phrases in parenthesis after each answer​ box, only apply for the answers you will type.

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