Which of the Following Is True Given Various States of the Economy

Multiple Choice

Which of the following is true given various states of the economy?

A) The various economic states of the economy are generally equally likely to occur in any given year
B) Most stocks tend to have the same return regardless of the economic state
C) The expected state of the economy can have a major impact on the expected return on a portfolio
D) If the economy moves into a recession period from a normal period, all stocks will have lower expected returns
E) A change in the probability of a state of the economy occurring has no impact on the expected return on a portfolio of risky assets