A risk adverse investor (an individual who does not want to take risks) has two investment options with the following statistics:

1^st Option: average rate of return of 8% with avariance of 4%²

2^nd Option: average rate of return of 12% with a variance of 25%²

a) Calculate the coefficient of variation for the 1^st Option. SHOWING BASC WORKINGS.

b) Calculate the coefficient of variation for the 2^nd Option. SHOWING BASC WORKINGS.

c) Briefly explain which investment option is less risky.