What is the expected return from an investment that has an equally likely probability to lose half of the investment or double the investment?
A)50%
B)25%
C)-50%
D)200%

Name: What is the expected return from an investment that has an equally likely probability to lose half of the investment or double the investment? A)50% B)25% C)-50% D)200%
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Question

Quizplus · Accepted Answer

The expected return is calculated as (0.5 * -50%) + (0.5 * 100%) = -25% + 50% = 25%.

What Is the Expected Return from an Investment That Has