Consider the following table: Stock Fund Bond Fund Scenario Probability Rate of Return Rate of Return Severe recession 0.05 –27 % –12 % Mild recession 0.25 –7 % 18 % Normal growth 0.40 12 % 11 % Boom...

Consider the following table:

		Stock Fund		Bond Fund
Scenario	Probability	Rate of Return		Rate of Return
Severe recession	0.05	–27	%		–12	%
Mild recession	0.25	–7	%		18	%
Normal growth	0.40	12	%		11	%
Boom	0.30	17	%		–8	%

a.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 2 decimal places.)

mean return:

variance:

b.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 2 decimal places.)

vovariance:

Jun 08, 2022

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Consider the following table: Stock Fund Bond Fund Scenario Probability Rate of Return Rate of Return Severe recession 0.05 –27 % –12 % Mild recession 0.25 –7 % 18 % Normal growth 0.40 12 % 11 % Boom...

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