Question: Based on the following stock return information for Johnson & Johnson and Walt Disney, State of Economy Probability of State of Economy Return on Johnson

Based on the following stock return information for Johnson & Johnson and Walt Disney,

State of Economy Probability of State of Economy Return on Johnson & Johnson Return on Walt Disney Co.
Sick .22 .028 .026
Normal .57 .130 .054
Healthy .21 .210 .084

The correlation between the returns of the two stocks is:

(Do not round intermediate calculations and round your answer to 4 decimal places, e.g., 32.1616.)

multiple choice

  • 0.019

  • 0.0004

  • 0.9644

  • 0.0015

  • 0.0807

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