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Suppose your expectations regarding the stock market are as follows: Probability 0.4 HPR 43% Normal growth State of the Economy Boom Normal growth Recession 0.5
Suppose your expectations regarding the stock market are as follows: Probability 0.4 HPR 43% Normal growth State of the Economy Boom Normal growth Recession 0.5 23 232 0.1 -16 E(v) = P(57) Var(-) = 92 = POr(s) E(P SD(r) = 0 = V Var(r) 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.) Answer is complete but not entirely correct. Mean Standard deviation 27.10 20.00 % %
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