An investor is concerned with the market return for the coming year. (The market return
is defined as the percentage gain (or loss, if negative) over the year.) The investor believes
there are 5 possible scenarios for the national economy in the coming year: rapid
expansion, moderate expansion, no growth, moderate contraction, and serious
contraction. Using all available information, the investor also estimates the market returns
for the scenarios are 0.21, 0.16, 0.09, 0.06, and 0.02 (basically, from 2% to 21%),
respectively. In addition, the investor assessed the probabilities of the scenarios as 0.13,
0.34, 0.26, 0.15, and 0.12, respectively.