5. Suppose your expectations regarding the stock market are as follows: State of the Economy Probability HPR Boom 0.3 44% Normal growth 0.4 14 Recession 0.3 - 16 Use Equations 5.10-5.12 to compute the mean and standard deviation of the HPR on stocks. 10 5-4) 6. The stock of Business Adventures sells for $40 a share. Its likely dividend payout and end of year price Page 139 depend on the state of the economy by the end of the year as follows: (@LO 5-2) Dividend Stock Price Boom $2.00 $50 Normal economy 1.00 43 Recession 0.50 34 a. Calculate the expected holding-period return and standard deviation of the holding-period return. All three scenarios are equally likely. b. Calculate the expected return and standard deviation of a portfolio invested half in Business Adventures and half in Treasury bills. The return on bills is 4%