Using Table 5.3 as your guide, what is your estimate of the expected annual HPR on the market index stock portfolio if the current risk-free interest rate is 5.0%? (Round your answer to 2 decimal places.)

TABLE 5.3 Risk and return of investments in major asset classes, 1927-2016 T-bills Stocks Arithmetic average Risk premium Standard deviation 3.42 N/A 3.14 14.71 -0.02 T-bonds 5.51 2.08 8.14 38.07 -8.47 11.91 8.48 19.99 56.38 -43.73 max min