Astock is expected to return 11% in a normal economy, 19% if the economy booms, and lose 8% if the economy moves into a recessionary period. the economists predict a 65% chance of a normal economy, a 25% chance of a boom, and a 10% chance of a recession. what is the expected return on the stock? a.11.10%b. 11.23%c. 12.06%d. 11.98%

Expected Return  = 11.10 %

so correct option is A. 11.10%

Explanation:

given data

return in normal economy = 11%

economy booms = 19%

economy moves loss = 8%

economists predict = 65%

boom = 25 %

chance of  recession = 10%

to find out

What is the expected return on the stock

solution

we get here Expected Return for all that is

State of Economy          Probability              Return         Expected Return

Normal                                65%                         11%                0.0715

Booms                                 25%                         19%               0.0475

Recessionary                       10%                         -8%               -0.0080

Expected Return                                                                       0.1110

as here Expected Return=  Probability  ×  Expected Return   1

Expected Return  = 11.10 %

so correct option is A. 11.10%

answer is i don't know

a manufacturer of printed circuit boards uses exponential smoothing with trend to forecast monthly demand of its product. at the end of december, the company wishes to forecast sales for january. the estimate of trend through november has been 200 additional boards sold per month. average sales have been around 1000 units per month. the demand for december was 1100 units. the company uses α = 0.20 and β = 0.10. make a forecast including trend for the month of january.