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Jay Hamilton, CFA, is analyzing Madison, Inc., a distressed firm. Hamilton believes the firm's survival over the next year depends on the state of the economy. Hamilton assigns probabilities to four economic growth scenarios and estimates the probability of bankruptcy for Madison under each: Prob of growth Prob of bankruptcyRecession (< 0%) 20% 60%Slow growth (0% to 2%) 30% 40%Normal growth (2% to 4%) 40% 20%Rapid growth (> 4%) 10% 10%Based on Hamilton's estimates, the probability that Madison, Inc. does not go bankrupt in the next year is closest to:A) 67%.B) 18%.C) 33%.
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