Assume that two investment opportunities have identical expected values of $100,000. Investment A has a variance of 10,500, while investment B's standard deviation is 8,000. We would expect most investors (who dislike risk) to prefer investment opportunity Select one: A. A because it provides higher potential earnings. B. B because it has less risk. C. B because of its higher potential earnings. D. A because it has less risk

Assume that two investment opportunities have identical expected values of $100,000. Investment A has a variance of 10,500, while investment B's standard deviation is 8,000. We would expect most investors (who dislike risk) to prefer investment opportunity Select one: A. A because it provides higher potential earnings. B. B because it has less risk. C. B because of its higher potential earnings. D. A because it has less risk

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)

14th Edition

ISBN:9781305506381

Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Chapter2: Fundamental Economic Concepts

Section: Chapter Questions

Problem 6E

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