Suppose your expectations regarding the stock market are as follows: State of the Economy Probability Boom 0.3 0.4 Normal growth Recession 0.3 E(r) = s=1 Mean Standard deviation S Var(r) = o=p(s)[r(s) - E(r)] p(s)[r(s) - E(+) p(s)r(s) s=1 HPR 44% SD (7) = = Var (7) 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.) % % 14 -16

Suppose your expectations regarding the stock market are as follows: E(r)=s=1sp(s)r(s)Var(r)=2=r=1sp(s)[r(s)E(r)]2SD(r)==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.)