Consider the following table:
| | Stock Fund | Bond Fund |
| Scenario | Probability | Rate of Return | Rate of Return |
| Severe recession | 0.10 | −36% | −11% |
| Mild recession | 0.20 | −12% | 13% |
| Normal growth | 0.35 | 12% | 4% |
| Boom | 0.35 | 32% | 5% |
|
a. Calculate the values of mean return andvariance for the stock fund. (Do not round intermediatecalculations. Round \"Mean return\" value to 1 decimal place and\"Variance\" to 2 decimal places.)
b. Calculate the value of the covariance betweenthe stock and bond funds. (Negative value should beindicated by a minus sign. Do not round intermediate calculations.Round your answer to 2 decimal places.)
Covariance          Â
