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A team of recent graduates from Concordia University just founded an investment firm. In order to maximize their profit, they believe that they should resort

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A team of recent graduates from Concordia University just founded an investment firm. In order to maximize their profit, they believe that they should resort to a world-class model seen in FINA 411 Portfolio Management so as to predict returns and standard deviations properly. While they do not remember the name of the model, they are sure about what they are doing. The risk-free rate is 0.25%. Now, there are examining the stocks of Firm A. More information on stock returns is provided below (please note that all stock returns are expressed in real terms, while probabilities are expressed in percentage) Probability Firm A Economic Condition Market Portfolio Inflation-Hedging Portfolio Bad 27.40% -0.1295 -0.0437 -0.0117 Neutral 48.75% 0.0439 -0.0093 0.0077 Good 23.85% 0.0787 0.0709 0.0169 Compute the covariance between the stocks of Firm A and the Market Portfolio (AMK)

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