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Consider the following table: Stock Fund Bond Fund Scenario Probability Rate of Return Rate of Return Severe recession 0.05 27 % 12 % Mild recession

Consider the following table:

Stock Fund Bond Fund
Scenario Probability Rate of Return Rate of Return
Severe recession 0.05 27 % 12 %
Mild recession 0.25 7 % 18 %
Normal growth 0.40 12 % 11 %
Boom 0.30 17 % 8 %

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.)

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.)

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