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Consider the following table: Scenario Severe recession Mild recession Normal growth Boom Probability 0.06 0.16 0.64 0.14 Stock Fund Rate of Return -45% -15% 11%

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Consider the following table: Scenario Severe recession Mild recession Normal growth Boom Probability 0.06 0.16 0.64 0.14 Stock Fund Rate of Return -45% -15% 11% 27% Bond Fund Rate of Return -31% 4% 5% 8% 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 Variance 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

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