Rate of return Douglas Keel, a financial analyst for Orange Industries, wishes to estimate the rate of return for two similar-risk investments, X and Y. Douglas's research indicates that the immediate past returns will serve as reasonablo estimates of future retums. A year earlier, Investment X had a market value of $29,000, and investment Y had a market value of $46,000. During the year, investment X generated cash flow of $2,175 and investment generated cash flow of $6.179. The current market values of investments X and Y are $29.775 and $46,000, respectively, a. Calculate the expected rate of return on investments X and Y using the most recent year's data. b. Assuming that the two investments are equally risky, which one should Douglas recommend? Why? a. The expected rate of return on investment X is % (Round to two decimal places.) The expected rate of return on investment Y is % (Round to two decimal places.) b. Assuming that the two investments are equally risky, which one should Douglas recommend? Why? (Select the best answer below.) O A. Douglas should recommend investment X because it has a higher rate of return and lower risk. B. Douglas should recommend investment Y because it has a lower rate of retum and equal risk. OC. Douglas should recommend investment Y because it has a higher rate of return and equal risk. OD. Douglas should recommend investment X because it has a higher rate of return and equal risk