Summerville Inc. is considering an investment in one of two common stocks. Given the information that follows, which investment is better, based on the risk (as measured by the standard deviation) and return of each? PROBABILITY 0.30 0.40 0.30 COMMON STOCK A RETURN 11% 15% 19% COMMON STOCK B PROBABILITY 0.20 0.30 0.30 0.20 RETURN -5% 6% 14% 22%

Summerville Inc. is considering an investment in one of two common stocks. Given the information that follows, which investment is better, based on the risk (as measured by the standard deviation) and return of each