Beasley Enterprises stock has an expected return of 11.5 percent.Given the information below,what is the expected return if the economy is in a recession?
A)-5.72 percent
B)-11.71 percent
C)-11.28 percent
D)-10.76 percent
E)5.72 percent

Question

Beasley Enterprises stock has an expected return of 11.5 percent.Given the information below,what is the expected return if the economy is in a recession? 
A)-5.72 percent 
B)-11.71 percent 
C)-11.28 percent 
D)-10.76 percent 
E)5.72 percent

Quizplus · Accepted Answer

E(R) = 0.115 = (0.18 × x) + (0.65 × 0.13) + (0.17 × 0.24)x = -5.72 percent

Beasley Enterprises Stock Has an Expected Return of 11