-If the Risk-Rate Is 5

Multiple Choice

$\begin{array}{c}\begin{array}{c}\underline{\text {State of the economy}}\\\text {Boom}\\\text {Normal}\\\text {Recession}\end{array}\begin{array}{c}\underline{\text {Probability}}\\.3\\.4 \\.3 \end{array}\begin{array}{c}\underline{\text {Stock F}}\\65 \% \\14 \% \\-50 \%\end{array}\end{array}$

-If the risk-rate is 5.8 percent, what is the risk premium of Stock F?

A) 15.9%
B) 5.25%
C) 4.87%
D) 4.30%
E) 5.06%