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consider the following table: Scenario Severe recession Mild recession Normal growth Boom Probability 0.05 0.22 0.59 0.14 Stock Fund Rate of Return -48% -14% 18%
consider the following table: Scenario Severe recession Mild recession Normal growth Boom Probability 0.05 0.22 0.59 0.14 Stock Fund Rate of Return -48% -14% 18% 33% Bond Fund Rate of Return -36% -5% 10% -1% a. Calculate the values of mean return and variance for the stock fund. (Do not round intermediate calculations. Round "Mean return" value to 2 decimal places and "Variance" to 4 decimal places.) Mean return 9.76 % Variance 0.0407 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 4 decimal places.) Covariance 0.0063
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