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Year 2016 2017 2018 2019 2020 Average A Rate of Return 18.1% 0.6% 9.6% 25.2% 8.5% 12.4% B 9.4% 10.9% 9.7% 14.8% 17.2% 12.4%
Year 2016 2017 2018 2019 2020 Average A Rate of Return 18.1% 0.6% 9.6% 25.2% 8.5% 12.4% B 9.4% 10.9% 9.7% 14.8% 17.2% 12.4% a. On the basis of a review of the return data, which investment appears to be more risky? Why? (Choose the best answer below.) A. The riskier investment appears to be investment B, with returns that vary widely from the average relative to investment A, whose returns show less deviation from the average. B. Investment A and investment B have equal risk because the average returns are the same. C. The riskier investment appears to be investment A, with returns that vary widely from the average relative to investment B, whose returns show less deviation from the average. OD. The riskier investment appears to be investment B, with returns that are closer to the average relative to investment A, whose returns are farther from the average. b. The standard deviation for investment A is %. (Round to two decimal places.) The standard deviation for investment B is %. (Round to two decimal places.) c. On the basis of your calculations in part b, which investment is more risky? Compare this conclusion to your observation in part a. (Choose the best answer below.) OA. Investment A is more risky than investment B, which does not support the conclusion reached in part a B. Investment A is more risky than investment B, which confirms the conclusion reached in part Oc. investment B is more risky than investment A, which confirms the conclusion reached in part a D. Investment B is more risky than investment A, which does not support the conclusion reached in part a.
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