What is the expected return on stock x for next year

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If the economy recovers next year, analysts expect Stock X's return for the year to be 20%; if the economy does not recover, analysts expect Stock X's return for the year to be -5%.

If there is a 40% chance that the economy will recover and a 60% that it will not, what is:

a. The expected return on Stock X for next year?

Reference no: EM131313026

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