QUESTION TWO XYZ Ltd is considering three possible capital projects for next year. Each project has a 1- year life, and project returns depend on next year's state of the economy. The estimated return are shown in the table: State of the Probability Rate of Return economy of occurrence A B Recession Average Boom 0.25 0.50 0.25 10% 14 16 9% 13 18 14% 12 10 Required: i. ii. iii. iv. Compute each projects expected rate of return Compute the variance and standard deviation of each project Compute the co-efficient of variation for each project Which is a better project? Why? (3 marks) (12 marks) (3 marks) (2 marks)