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Scenario Probability Rate of Return Rate of Return Severe recession 0.10 34% 10% Mild recession 0.20 18% 6% Normal growth 0.45 14% 7% Boom 0.25

Scenario Probability Rate of Return Rate of Return
Severe recession 0.10 34% 10%
Mild recession 0.20 18% 6%
Normal growth 0.45 14% 7%
Boom 0.25 24% 3%

b.

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 4 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 4 decimal places.)

Covariance

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