Problem 13-22 Portfolio effect of a merger [LO13-5] Treynor Pie Company is a food company specializing in high-calorie snack foods. It is seeking to diversify its food business and lower its risks. It is examining three companies-a gourmet restaurant chain, a baby food company, and a nutritional products firm. Each of these companies can be bought at the same multiple of earnings. The following represents information about all the companies. Correlation with Treynor Pie Company Sales ($ millions) Company Standard Deviation in Earnings (5 millions) Expected Earnings (5 millions) -1.0 $ 189 58 $2.0 Treynor Pie Company Gourmet restaurant +0.4 63 7 1.4 Baby food company -0.3 57 4 1.6 Nutritional products company -0.5 76 5 3.3 a-1. Compute the coefficient of variation for each of the four companies. (Enter your answers in millions (e.g., $100,000 should be entered as "10"). Round your answers to 3 decimal places.) Coefficient of Variation Treynor Pie Company Gourmet restaurant Baby food company Nutritional products company a-2. Which company is the least risky? O Treynor Pie Company Baby food company O Gourmet restaurant O Nutritional products company a-3. Which company is the most risky? O Gourmet restaurant O Baby food company Treynor Pie Company O Nutritional products company b. Which of the acquisition candidates is most likely to reduce Treynor Pie Company's risk? O Nutritional products company Baby food company O Gourmet restaurant