Question

As the manager of High Speed Records, you have signed a new artist to the label. There are three different outcomes for investing in the artist. What is the expected return on investment using the information below? Outcome Probability Return 1. .35 .20 2. .25 .36 3. .40 .10 *Make sure your answer is in a decimal format (.25, .90, etc.) and not a percentage (25%). Round to the nearest hundredth. (0.089 -> 0.09)

Answer 1

Answer: 0.2

Step-by-step explanation:

To get the Outcome Probability Return we multiply the probability by return, then add them all up .

1).35 .20 = 0.07

2).25 .36 =0.09

3) .40 .10= 0.04

Total = 0,2

Therefore Outcome Probability Return = 0.2