Many (most) investors are risk averse. That is, all other things being equal, they would prefer to own an asset with predictable future values instead of unpredictable, and as a result, will demand higher expected returns for taking on riskier assets. Let r be the risk-less rate of return (compound rate of return on a risk-less asset, such as a government bond). In a market where your average investor is risk averse, explain why, for a given stock with drift and volatility not = 0, we would in general expect to see > r + ^ 2 / 2.