What is the expected return for this two stock portfolio

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There is a 11% probability of an average economy and a 89% probability of an above average economy. You invest 14% of your money in Stock S and 86% of your money in Stock T. In an average economy the expected returns for Stock S and Stock T are 14% and 14%, respectively. In an above average economy the the expected returns for Stock S and T are 35% and 39%, respectively. What is the expected return for this two stock portfolio? (4 decimals)

Reference no: EM132072248

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