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Consider the following table: Scenario Severe recession Mild recession Normal growth Boom Probability 0.10 0.20 0.40 0.30 Stock Fund Rate of Return -37% -17% 22%
Consider the following table: Scenario Severe recession Mild recession Normal growth Boom Probability 0.10 0.20 0.40 0.30 Stock Fund Rate of Return -37% -17% 22% 27% Bond Fund Rate of Return -10% 16% 9% -6% a.Calculate the values of mean return and variance for the stock fund. (Do not round intermediate calculations. Round "Mean return" value to 1 decimal place and "Variance" to 2 decimal places.) & Answer is complete but not entirely correct. % Mean return Variance 9.8 5.11 X b.Calculate the value of the covariance between the stock and bond funds. (Negative value should be indicated by a minus sign. Do not round intermediate calculations. Round your answer to 2 decimal places.) Answer is complete but not entirely correct. Covariance (0.00)
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