Given a choice between two investments with the same expected payoff most people will

choose the one with the lower standard deviation.

opt for the one with the higher standard deviation.

be indifferent since the expected payoffs are the same.

calculate the variance to assess the relative risks of the two choices.

Leverage

reduces risk.

is synonymous with risk$-$free investhent.

increases expected rate of return.

leads to smaller changes in the investment's price.