Consider the following table Stock Fund Bond Fund Scenario Probability Rate of Return Rate of Return Severe recession 0 05 33 12 Mild recession 0 25 13 18 Normal growth 0 40 18 11 Boom 0 30 23 8 b Calculate the values of mean return and variance for the stock fund (Do not round intermediate calculations Round Mean return value to 2 decimal place and Variance to 2 decimal places ) Mean return Variance c 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 ) Covariance

Question

Consider the following table  Stock Fund Bond Fund Scenario Probability Rate of Return Rate of Return Severe recession 0 05 33  12  Mild recession 0 25 13  18  Normal growth 0 40 18  11  Boom 0 30 23  8  b  Calculate the values of mean return and variance for the stock fund  (Do not round intermediate calculations  Round  Mean return  value to 2 decimal place and  Variance  to 2 decimal places ) Mean return   Variance c  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 ) Covariance

Accepted Answer

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		Stock Fund	Bond Fund
Scenario	Probability	Rate of Return	Rate of Return
Severe recession	0.05	33%	12%
Mild recession	0.25	13%	18%
Normal growth	0.40	18%	11%
Boom	0.30	23%	8%

Question

Consider the following table: Stock Fund Bond Fund Scenario Probability Rate of Return Rate of Return Severe recession 0.05 33% 12% Mild recession 0.25 13%

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