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In: Finance

Suppose your expectations regarding the stock market are as follows: State of the Economy Probability HPR...

Suppose your expectations regarding the stock market are as follows:


State of the Economy Probability HPR
Boom 20% 15%
Normal growth 50% 7%
Recession 30% -10%

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.)


Mean %
Standard deviation %

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