What is required // calculate the required rate of return with an opinion on acceptance or rejection of the project?

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
Section: Chapter Questions
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The first question // one of the investors wants to establish a project that achieves net returns related to economic activity,
as in the following table that shows the returns achieved in the market, noting that the risk-free rate of return is
%8
The market is back
The project is back
Probability
Economical Status
%40
%20
%25
0.25
Stable
%15
0.50
recovery
%13
% 10-
0.25
Recession
What is required // calculate the required rate of return with an opinion on acceptance or rejection of the project?
Transcribed Image Text:The first question // one of the investors wants to establish a project that achieves net returns related to economic activity, as in the following table that shows the returns achieved in the market, noting that the risk-free rate of return is %8 The market is back The project is back Probability Economical Status %40 %20 %25 0.25 Stable %15 0.50 recovery %13 % 10- 0.25 Recession What is required // calculate the required rate of return with an opinion on acceptance or rejection of the project?
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