Three assets, X, Y, and Z are currently being considered by Smith Investors. The probability distributions of the expected returns are shown below: Outcome Asset X Asset Y Asset Z Probability % Return % Probability % Return % Probability % Return % 1 10 40 45 35 12 40 2 22 10 28 10 18 20 3 41 0 27 -20 38 10 4 22 -5 20 0 5 5 -10 12 -20

6.1. Calculate the expected value for return of each asset. Which provides the largest expected return? [4]

6.2. Calculate the standard deviation for each asset. Which appears to have the largest risk? [6]

6.3. Calculate the coefficient of variation for each asset. Which appears to have the largest relative risk? [4]

6.4. Which of the assets would you recommend? Explain your answer. [2]