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Question 5 Consider the following information on two stocks: State Stock A Stock B 0.25 0.02 Boom Normal Prob(State) 20% 40% 40% 0.11 0.15 0.04

Question 5 Consider the following information on two stocks: State Stock A Stock B 0.25 0.02 Boom Normal Prob(State) 20% 40% 40% 0.11 0.15 0.04 Bust -0.09 Calculate the covariance(A,B). (Enter percentages as decimals and round to 4 decimals)

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