Investment returns and deviation returns
5 investment alternatives have the following returns and standard deviations of returns.
| Alternative | Returns: Expected Value | Standard Deviation | ||||
| A | $1,550 | $880 | ||||
| B | 3,330 | 1,360 | ||||
| C | 3,330 | 1,140 | ||||
| D | 5,540 | 2,660 | ||||
| E | 14,600 | 4,860 | ||||
Rank the five alternatives from lowest risk to highest risk using the coefficient of variation. (Round the final answers to 2 decimal places.)
| Alternatives | Coefficient of Variation |
| A | |
| B | |
| C | |
| D | |
| E | |
| Ranking | Alternative |
| Lowest risk | |
| | | |
| to | |
| | | |
| Highest risk | |
Homework Answers
Five investment alternatives have the following returns and standard deviations of returns. Alternatives A B C...
Five investment alternatives have the following returns and standard deviations of returns. Alternatives A B C D E Returns: Expected Value $ 1,350 1,180 7,700 1,810 63,300 Standard Deviation $ 500 1,470 2,100 690 14,700 Calculate the coefficient of variation and rank the five alternatives from the lowest risk to the highest risk by using the coefficient of variation. (Round your answers to 3 decimal places.) Alternatives Coefficient of Variation Rank A B с D E
Possible outcomes for three investment alternatives and their probabilities of occurrence are given next. Failure Acceptable...
Possible outcomes for three investment alternatives and their probabilities of occurrence are given next. Failure Acceptable Successful Alternative 1 Outcomes Probability 30 0.10 70 0.50 105 0.40 Alternative 2 Outcomes Probability 80 0.20 195 0.40 250 0.40 Alternative 3 Outcomes Probability 110 0.30 350 0.50 400 0.20 Using the coefficient of variation, rank the three alternatives in terms of risk from lowest to highest. (Do not round intermediate calculations. Round your answers to 3 decimal places.) Coefficient of Variation Rank...
Alternate investment outcomes
ossible outcomes for three investment alternatives and their probabilities of occurrence are given below. Alternative 1Alternative 2Alternative 3OutcomesProbabilityOutcomesProbabilityOutcomesProbability Failure$600.40$700.20$700.30 Acceptable900.201650.402200.50 Successful1200.402500.403950.20 Rank the three alternatives in terms of least risk to most risk. (Do not round intermediate calculations. Round the final answers to 3 decimal places.) Coefficient ofVariationAlternative 1Alternative 2Alternative 3 AlternativeLeast risky (Click to select) Alternative 2 Alternative 1 Alternative 3 | (Click to select) Alternative 2 Alternative 1 Alternative 3 Most risky (Click to select) Alternative 2 Alternative 1 Alternative 3
Possible outcomes for three investment alternatives and their probabilities of occurrence are given next. Alternative...
Possible outcomes for three investment alternatives and their probabilities of occurrence are given next. Alternative 1 Alternative 2 Alternative 3 Outcomes Probability Outcomes Probability Outcomes Probability Failure 50 .2 90 .3 95 .2 Acceptable 90 .4 190 .3 215 .6 Successful 135 .4 225 .4 380 .2 Using the coefficient of variation, rank the three alternatives in terms of risk from lowest to highest. (Do not round intermediate calculations. Round your answers to 3 decimal places.)
Possible outcomes for three investment alternatives and their probabilities of occurrence are given below. Alternative 1...
Possible outcomes for three investment alternatives and their probabilities of occurrence are given below. Alternative 1 Alternative 2 Alternative 3 Outcomes Probability Outcomes Probability Outcomes Probability Failure $ 30 0.10 $ 80 0.20 $ 110 0.30 Acceptable 70 0.50 195 0.40 350 0.50 Successful 105 0.40 250 0.40 400 0.20 Rank the three alternatives in terms of least risk to most risk. (Do not round intermediate calculations. Round the final answers to 3 decimal places.) Rank Coefficient of Variation (Click...
Problem 13-13 (modified) Possible outcomes for three investment alternatives and their probabilities of occurrence are given...
Problem 13-13 (modified) Possible outcomes for three investment alternatives and their probabilities of occurrence are given below. Failure Acceptable Successful Alternative 1 Outcomes Probability $ 60 @.40 90 0.20 120 0.40 Alternative 2 Outcomes Probability $ 70 @.20 165 0.40 250 0.40 Alternative 3 Outcomes Probability $ 70 0.30 220 0.50 395 0.29 Rank the three alternatives in terms of least risk to most risk. (Do not round intermediate calculations. Round the final answers to 3 decimal places.) Coefficient of...
Please assist in solving all parts Standard deviation versus coefficient of variation as measures of risk...
Please assist in solving all parts
Standard deviation versus coefficient of variation as measures of risk Greengage, Inc., a successful nursery, is considering several expansion projects. All the alternatives promise to produce an acceptable return. Data on four possible projects appear in the following table: a. Which project is least risky, judging on the basis of range? b. Which project has the lowest standard deviation? Explain why standard deviation may not be an entirely appropriate measure of risk for purposes...
Standard deviation versus coefficient of variation as measures of risk Greengage, Inc., a successful nursery, is...
Standard deviation versus coefficient of variation as measures of risk Greengage, Inc., a successful nursery, is considering several expansion projects. All of the alternatives promise to produce an acceptable return. Data on four possible projects appear in the following table ! a. Which project is least risky, judging on the basis of range? Data Table b. Which project has the lowest standard deviation? Explain why standard deviation may not be an entirely appropriate measure of risk for purposes of this...
QUESTION 28 The expected returns, standard deviation, and coefficient variation of Stocks A and B are...
QUESTION 28 The expected returns, standard deviation, and coefficient variation of Stocks A and B are given below. If you are risk adverse investor, which stock will you buy? | Stocks | Expected Return Std. Deviation Coefficient Variation, CV A 15% 4% 0.27 B 12% 3% 0.25 O Stock A since expected return is higher Stock B since standard deviation is lower O Stock A since coefficient variation is higher Stock B since coefficient variation is lower O Need additional...
8.2 The coefficient of variation is a better measure of stand-alone risk than standard deviation because...
8.2
The coefficient of variation is a better measure of stand-alone risk than standard deviation because it is a standardized measure of risk per unit; it is calculated as the -Select- divided by the expected return. The coefficient of variation shows the risk per unit of return, so it provides a more meaningful risk measure when the expected returns on two alternatives are not -Select- .. The Sharpe ratio compares the asset's realized excess return to its -Select- over a...
Five investment alternatives have the following returns and standard deviations of returns. Alternatives A B C D E Returns: Expected Value $ 1,350 1,180 7,700 1,810 63,300 Standard Deviation $ 500 1,470 2,100 690 14,700 Calculate the coefficient of variation and rank the five alternatives from the lowest risk to the highest risk by using the coefficient of variation. (Round your answers to 3 decimal places.) Alternatives Coefficient of Variation Rank A B с D E
Possible outcomes for three investment alternatives and their probabilities of occurrence are given next. Failure Acceptable Successful Alternative 1 Outcomes Probability 30 0.10 70 0.50 105 0.40 Alternative 2 Outcomes Probability 80 0.20 195 0.40 250 0.40 Alternative 3 Outcomes Probability 110 0.30 350 0.50 400 0.20 Using the coefficient of variation, rank the three alternatives in terms of risk from lowest to highest. (Do not round intermediate calculations. Round your answers to 3 decimal places.) Coefficient of Variation Rank...
Problem 13-13 (modified) Possible outcomes for three investment alternatives and their probabilities of occurrence are given below. Failure Acceptable Successful Alternative 1 Outcomes Probability $ 60 @.40 90 0.20 120 0.40 Alternative 2 Outcomes Probability $ 70 @.20 165 0.40 250 0.40 Alternative 3 Outcomes Probability $ 70 0.30 220 0.50 395 0.29 Rank the three alternatives in terms of least risk to most risk. (Do not round intermediate calculations. Round the final answers to 3 decimal places.) Coefficient of...
Please assist in solving all parts
Standard deviation versus coefficient of variation as measures of risk Greengage, Inc., a successful nursery, is considering several expansion projects. All the alternatives promise to produce an acceptable return. Data on four possible projects appear in the following table: a. Which project is least risky, judging on the basis of range? b. Which project has the lowest standard deviation? Explain why standard deviation may not be an entirely appropriate measure of risk for purposes...
Standard deviation versus coefficient of variation as measures of risk Greengage, Inc., a successful nursery, is considering several expansion projects. All of the alternatives promise to produce an acceptable return. Data on four possible projects appear in the following table ! a. Which project is least risky, judging on the basis of range? Data Table b. Which project has the lowest standard deviation? Explain why standard deviation may not be an entirely appropriate measure of risk for purposes of this...
QUESTION 28 The expected returns, standard deviation, and coefficient variation of Stocks A and B are given below. If you are risk adverse investor, which stock will you buy? | Stocks | Expected Return Std. Deviation Coefficient Variation, CV A 15% 4% 0.27 B 12% 3% 0.25 O Stock A since expected return is higher Stock B since standard deviation is lower O Stock A since coefficient variation is higher Stock B since coefficient variation is lower O Need additional...
8.2
The coefficient of variation is a better measure of stand-alone risk than standard deviation because it is a standardized measure of risk per unit; it is calculated as the -Select- divided by the expected return. The coefficient of variation shows the risk per unit of return, so it provides a more meaningful risk measure when the expected returns on two alternatives are not -Select- .. The Sharpe ratio compares the asset's realized excess return to its -Select- over a...
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