In finance, the stand-alone risk of a stock is generally measured by a variance or standard deviation. You are more interested in the standard deviation since it is denominated in the same unit as the original data. The stock you hold has a return variance of 0.16. The standard deviation of returns on this stock is 1) 4% 2) 16% 3) 40% 4) 50% 5) 0.4% Over the past year you earned a nominal rate of return of 12.7% on your investment. The inflation rate was 4.8 percent over the same period. The exact actual growth rate of your purchasing power was 1) 7.54% 2) 7.90% 3) 12.7% 4) 12.9% 5) 14.8% Consider the following two investment alternatives. First, a risky portfolio that pays 15% rate of return with a probability of 60% or 5% rate of return with a probability of 40%. Second, a treasury bill that pays 6%. The risk premium on the risky portfolio is 1) 1% 2) 5% 3) 10% 4) 15% 5) 20%