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Expected Return Year Asset F Asset G Asset H 2016 16% 17% 14% 2017 17 16 15 2018 18 15 16 2019 19 14 17
Expected Return | ||||||||
Year | Asset F | Asset G | Asset H | |||||
2016 | 16% | 17% | 14% | |||||
2017 | 17 | 16 | 15 | |||||
2018 | 18 | 15 | 16 | |||||
2019 | 19 | 14 | 17 | |||||
Using these assets, you have isolated the three investment | ||||||||
Alternatives shown in the following table | ||||||||
Alternative | Investment | |||||||
1 | 100% of F | |||||||
2 | 50% of f and G | |||||||
3 | 50% of f and H | |||||||
a. calculate the expected return over the 4 year period for all three alternatives | ||||||||
b. calculate the standard deviation of returns ov the 4 year periof for each of the three alternatives | ||||||||
c. Use your finding in part a and b to calculate the coefficient of variation for the three alternatives | ||||||||
d. on the basis of your findings, which of the three investment alternaives do you recommend, why? |
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