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    Exam 4: Determining Interest Rates
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    Suppose There's an 80% Chance of a Stock Rising by 20
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Suppose There's an 80% Chance of a Stock Rising by 20

Question 54

Question 54

Multiple Choice

Suppose there's an 80% chance of a stock rising by 20% and a 20% chance of it falling by 40%.What is the expected rate of return on the stock?


A) -40%
B) -20%
C) 8%
D) 16%

Correct Answer:

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