Question

Consider the following table:     Stock Fund Bond Fund Scenario Probability Rate of Return Rate of...

Consider the following table:

   

Stock Fund Bond Fund
Scenario Probability Rate of Return Rate of Return
Severe recession 0.10 −39% −12%
Mild recession 0.20 −19% 18%
Normal growth 0.40 24% 11%
Boom 0.30 29% −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 %-Squared


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.)

Covariance       %-Squared

Homework Answers

Answer #1

Please refer to below spreadsheet for calculation and answer. Cell reference also provided.

Cell reference -

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Consider the following table:     Stock Fund Bond Fund Scenario Probability Rate of Return Rate of...
Consider the following table:     Stock Fund Bond Fund Scenario Probability Rate of Return Rate of Return Severe recession 0.10 −37% −10% Mild recession 0.20 −17% 16% Normal growth 0.40 22% 9% Boom 0.30 27% −6% 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 ??? %-Squared b. Calculate the value of...
Consider the following table: Stock Fund Bond Fund Scenario Probability Rate of Return Rate of Return...
Consider the following table: Stock Fund Bond Fund Scenario Probability Rate of Return Rate of Return Severe recession 0.10 −32% −10% Mild recession 0.15 −10.0% 6% Normal growth 0.35 22% 10% Boom 0.40 37% −7% 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 4 decimal places.) Mean return % Variance %-Squared b. Calculate the value of the covariance between...
Problem 6-7 Consider the following table:      Stock Fund Bond Fund Scenario Probability Rate of Return...
Problem 6-7 Consider the following table:      Stock Fund Bond Fund Scenario Probability Rate of Return Rate of Return   Severe recession 0.10        −34%        −9%            Mild recession 0.20        −20%        5%            Normal growth 0.30        21%        9%            Boom 0.40        36%        6%          a. Calculate the values of mean return and variance for the stock fund. (Do not round intermediate calculations. Round...
Consider the following table: Stock Fund Bond Fund Scenario Probability Rate of Return Rate of Return...
Consider the following table: Stock Fund Bond Fund Scenario Probability Rate of Return Rate of Return Severe recession 0.20 −38% −12% Mild recession 0.20 −26.0% 20% Normal growth 0.35 8% 3% Boom 0.25 46% −7% 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 4 decimal places.) Mean return % Variance %-Squared b. Calculate the value of the covariance between...
Consider the following table: Stock Fund Bond Fund Scenario Probability Rate of Return Rate of Return...
Consider the following table: Stock Fund Bond Fund Scenario Probability Rate of Return Rate of Return Severe recession 0.10 −32% −17% Mild recession 0.15 −22% 15% Normal growth 0.35 14% 6% Boom 0.40 35% 4% 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 4 decimal places.) Mean return % Variance b. Calculate the value of the covariance between the...
Consider the following table: Stock Fund Bond Fund Scenario Probability Rate of Return Rate of Return...
Consider the following table: Stock Fund Bond Fund Scenario Probability Rate of Return Rate of Return Severe recession 0.10 ?37% ?9% Mild recession 0.20 ?11% 15% Normal growth 0.35 14% 8% Boom 0.35 30% ?5% 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...
Consider the following table: Stock Fund Bond Fund Scenario Probability Rate of Return Rate of Return...
Consider the following table: Stock Fund Bond Fund Scenario Probability Rate of Return Rate of Return Severe recession 0.05 −28% −13% Mild recession 0.25 −8% 19% Normal growth 0.40 13% 12% Boom 0.30 18% −9% 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.) Expert Answer Anonymous answered this Was this answer helpful? 0 0 7,656 answers...
Consider the following table: Stock Fund Bond Fund Scenario Probability Rate of Return Rate of Return...
Consider the following table: Stock Fund Bond Fund Scenario Probability Rate of Return Rate of Return Severe recession 0.05 –40 % –9 % Mild recession 0.25 –14 % 15 % Normal growth 0.40 17 % 8 % Boom 0.30 33 % –5 % 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.) Covariance %-Squared   
Consider the following table: Stock Fund Bond Fund Scenario Probability Rate of Return Rate of Return...
Consider the following table: Stock Fund Bond Fund Scenario Probability Rate of Return Rate of Return Severe recession 0.05 –25 % –10 % Mild recession 0.25 –5 % 16 % Normal growth 0.40 10 % 9 % Boom 0.30 15 % –6 % 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.) b.Calculate the value of the covariance...
Consider the following table: Stock Fund Bond Fund Scenario Probability Rate of Return Rate of Return...
Consider the following table: Stock Fund Bond Fund Scenario Probability Rate of Return Rate of Return Severe recession 0.05 –26 % –11 % Mild recession 0.25 –6 % 17 % Normal growth 0.40 11 % 10 % Boom 0.30 16 % –7 % 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.) b.Calculate the value of the covariance...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT