Aziza company is considering an investment in one of two common stock, Given the information that follows, which investment is better, based on risk (as measured by the standard deviation) and return ?

common stock A		common stock B
probability	return	probability	return
0.3	11%	0.2	-5%
0.4	15%	0.3	6%
0.3	19%	0.3	14%
		0.2	22%

use the following end-of-year price data to answer the questions:

a. compute the annual rates of return for each time for both firms.

b. calculate both the arithmetic and the geometric mean rates of return for the entire three-year period using your annual rates of return for part a. (Note: you may assume that neither firm pays any dividends)

c. compute a three-year rate of return spanning the entire period (i.e, using the beginning price for Period 1 and ending price for period 4)

Time	A	B
1	10$	12$
2	8$	32$
3	12$	28$
4	15$	27$