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roblem 5-5 Suppose your expectations regarding the stock market are as follows: State of the Economy Probability HPR Boom 0.3 44% Normal growth 0.4 14

roblem 5-5

Suppose your expectations regarding the stock market are as follows:

State of the Economy Probability HPR
Boom 0.3 44%
Normal growth 0.4 14
Recession 0.3 -16

Use above equations to compute the mean and standard deviation of the HPR on stocks. (Do not round intermediate calculations. Round your answers to 2 decimal places.)

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