Maria sees the growth of her business for the upcoming year as being tied to the gross domestic product (GDP). She believes that her business will grow (or contract) at the rate of 5%, 4.5%, 3%, 0%, or - 0.5% per year if the GDP grows (or contracts) at the rate of between 2 and 2.5%, between 1.5 and 2%, between 1 and 1.5%, between 0 and 1%, and between - 1 and 0%, respectively.

Question

Maria has decided to assign a probability of 0.11, 0.23, 0.43, 0.19, and 0.04, respectively, to each outcome. At what rate does Maria expect her business to grow next year? Give your answer to three decimal places, if necessary.
__________ %

Answer 1

2.855