Over the next year, there is a 75% chance of the market being in state 1, otherwise it is in state 2. Shares in Cornelius.com will earn a return of 6.60% in state 1, and 5.80% in state 2. Shares in GiantBadger will earn a return of 6.60% in state 1, and 2.90% in state 2. You have invested 48% of your money Cornelius.com, with the remainder in GiantBadger. What is your expected return over the next year? O 6.60% O 6.02%

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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Over the next year, there is a 75% chance of the market being in state 1, otherwise it is in state 2. Shares in Cornelius.com will earn a return of 6.60% in state 1, and 5.80% in state 2. Shares in GiantBadger will earn a return of 6.60% in state 1, and 2.90% in state 2. You have invested 48% of your money in
Cornelius.com, with the remainder in GiantBadger. What is your expected return over the next year?
O 6.60%
6.02%
5.81%
4.29%
Transcribed Image Text:Over the next year, there is a 75% chance of the market being in state 1, otherwise it is in state 2. Shares in Cornelius.com will earn a return of 6.60% in state 1, and 5.80% in state 2. Shares in GiantBadger will earn a return of 6.60% in state 1, and 2.90% in state 2. You have invested 48% of your money in Cornelius.com, with the remainder in GiantBadger. What is your expected return over the next year? O 6.60% 6.02% 5.81% 4.29%
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