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Your companys coefficient of variation is .4. Which of the following firms would make sense for you to acquire, based on reduction of earnings per
Your companys coefficient of variation is .4. Which of the following firms would make sense for you to acquire, based on reduction of earnings per share risk?
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There is not enough data to answer this question.
Firm B, with expected value of EPS of $2.50 and standard deviation 0.5.
Firm C, with expected value of EPS of $2.50 and standard deviation 2.
Firm A, with expected value of EPS of $1.50 and standard deviation 1.
Yes, since their combined EPS increases.
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