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Suppose your expectations regarding the stock market are as follows: State of the Economy Boom Normal growth Recession Probability 0.2 0.6 HPR 37% 22 0.2

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Suppose your expectations regarding the stock market are as follows: State of the Economy Boom Normal growth Recession Probability 0.2 0.6 HPR 37% 22 0.2 -20 E() por Var(n = o-- POI-6) E()p SD(-) = = = VVar(r) Use above equations to compute the mean and standard deviation of the HPR on stocks. (Do not round Inter Round your answers to 2 decimal places.) Mean % Standard deviation 96

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