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ABC College is considering an investment in one of two common stocks to add to the employees' retirement portfolios. Given the following information, which investment is better, based upon the risk (as measured by the standard deviation) and return of each?

STOCK A1

Return     Probability Expected Rate of Return     Standard Deviation

11% 0.30 ?

15%    0.40    ?  

19%           0.30    ? ?

STOCK B1

Return     Probability Expected Rate of Return     Standard Deviation

-05% 0.20    ?  

06%       0.30    ?

14%           0.30    ?

22%    0.20    ?     ?

Financial Management, Finance

  • Category:- Financial Management
  • Reference No.:- M91612400

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