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How do determine what is the expected rate of return

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Problem 1: Mary invested $500. She received two payments of $100 and then sold her stake in the investment for $400. What was her rate of return?

Problem 2: An investment has a 10% chance of returning 20%, a 70% chance of returning 10%, and a 20% chance of returning nothing. What is the expected rate of return?

Reference no: EM132736104

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