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Suppose Lena wants to make a choice among the following three mutually exclusive retirement funds. Fund E(R) SD(R) A 0.05 0.3 B 0.05 0.2 C

Suppose Lena wants to make a choice among the following three mutually exclusive retirement funds.

Fund E(R) SD(R)

A

0.05 0.3

B

0.05 0.2

C

0.33 0.3

If Lena is a _____1_____ investor, she will choose fund A over C.

If Lena is a _____2_____ investor, she will choose fund B over A.

a.

1. non-satiated, 2. risk-seeking

b.

1. non-satiated, 2. risk-averse

c.

1. risk-seeking, 2. non-satiated

d.

1. risk-averse, 2. non-satiated

e.

none of the above

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