Hi,

I need help with the HW problem from my textbook. I do not plan on submitting a tutors work as my own.

1. Here is the expected return data shown in the first table on three assetsF, G, and Hover the period 2015-2018

Year

Asset Asset G Asset H

F

2015 11 12 15

2016 9 9 17

2017 7 21 19

2018 16 6 10

Using the assets above, you have isolated the three investment alternatives shown in the following table.

Alternative Investment

1

100% of asset F

2

50% of asset F and 50% of asset G

3

50% of asset F and 50% of asset H

1. Calculate the expected return over the 4-year period for each of the three alternative
2. Calculate the standard deviation of returns over the 4-year period for each of the three alternatives.
3. Use your findings in parts a and b to calculate the coefficient of variation for each of the three alternatives.
4. On the basis of your findings, which of the three investment alternatives do you recommend? Why?