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What is the market risk premium, if the risk-free rate is 9% and the expected m...
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What is the market risk premium, if the risk-free rate is 9% and the expected market return is given as follows:
Conditional state of the economy
|
Probability
|
Return
|
Optimistic
|
45%
|
25%
|
Normal
|
50%
|
15%
|
Pessimistic
|
5%
|
15%
|
0%
0%
0%
0%