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Compute the expected return and standard deviation for each of the following investments: Investment (A): Pays $1000 three-fourths of the time and a $1500 loss

Compute the expected return and standard deviation for each of the following investments:

Investment (A): Pays $1000 three-fourths of the time and a $1500 loss otherwise.

Investment (B): Pays $1200 loss half of the time and a $1,800 gain otherwise.

State which investment will be preferred by each of the following investors, and explain why.

(1)a risk-neutral investor.

(2) an investor who seeks to avoid the worst-case scenario.

(3) a risk-averse investor.

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