A risk-free investment of 50000 offers an annual return of


A risk-free investment of $50,000 offers an annual return of 6%. A risky investment of $50,000 had a 40% probability of default, in which case it will pay only $25,000. What return must the risky investment promise? 8.1%, 62%, 43.3% or 17.7%

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Finance Basics: A risk-free investment of 50000 offers an annual return of
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