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Instruction 5 -Referring to Instruction 5

question 43

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Instruction 5.3
There are two houses with almost identical characteristics available for investment in two different neighbourhoods with drastically different demographic composition. The anticipated gain in value when the houses are sold in 10 years has the following probability distribution:
Returns
 Probability  Neighbourhood A  Neighbourhood B 0.25$22,500$30,5000.40$10,000$25,0000.35$40,500$10,500\begin{array} { | c | c | c | } \hline \text { Probability } & \text { Neighbourhood A } & \text { Neighbourhood B } \\\hline 0.25 & - \$ 22,500 & \$ 30,500 \\\hline 0.40 & \$ 10,000 & \$ 25,000 \\\hline 0.35 & \$ 40,500 & \$ 10,500 \\\hline\end{array}
-Referring to Instruction 5.3,what is the covariance of the two houses?


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