Question: State of Nature Probability State Dependent Return A State Dependent Return B Recession Expansion 70% 30% -.08 .28 -.04 .16 Using the data in the

State of Nature Probability State Dependent Return A State Dependent Return

State of Nature Probability State Dependent Return A State Dependent Return B Recession Expansion 70% 30% -.08 .28 -.04 .16 Using the data in the table above, which of the following comes closest to the covariance between Stock A and Stock B? A. The covariance between Stock A and Stock B = 0.0151 B. The covariance between Stock A and Stock B = -0.0117 C. The covariance between Stock A and Stock B = 0.1170 D. -The covariance between Stock A and Stock B = 0.0028 E. The covariance between Stock A and Stock B = 0.0000

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