An investor is considering two equally risky investments. Investment A is expected to return $1,000 per year for the next 5 years. Investment B is expected to return $6,000 at the end of 5 years. Which of the following statements is most correct if both investments A and B have the same cost?

Select one:

a. the investor will select investment A only if the cost is less than $1,000

b. the investor may select investment A or investment B depending on the opportunity cost of money

c. a risk averse investor will select investment B because it is expected to provide the most cash ($6,000 > $5,000)

d. a risk averse investor will select investment A because it provides cash earlier than investment B