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Investment advisors estimated the stock market returns for fourmarket segments: computers, financial, manufacturing, andpharmaceuticals. Annual return projections vary depending onwhether the general economic conditions are improving, stable, ordeclining. The anticipated annual return percentages for eachmarket segment under each economic condition are as follows:Economic ConditionMarket SegmentImprovingStableDecliningComputers102-4Financial85-3Manufacturing64-2Pharmaceuticals65-1(a)Assume that an individual investor wants to select one marketsegment for a new investment. A forecast shows improving todeclining economic conditions with the following probabilities:improving 0.5, stable 0.3, and declining 0.2. What is the preferredmarket segment for the investor?- Select your answer-ComputersFinancialsManufacturingPharmaceuticalsItem 1What is the expected return percentage? Round your answer inone decimal place.Expected Return = %(b)At a later date, a revised forecast shows a potential for animprovement in economic conditions. New probabilities are asfollows: improving 0.5, stable 0.2, and declining 0.3. What is thepreferred market segment for the investor based on these newprobabilities?- Select your answer-ComputersFinancialsManufacturingPharmaceuticalsItem 3What is the expected return percentage? Round your answer inone decimal place.
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