Sangam, an investor advisor is considering two possible investments. Information about the investments as follows: Investment...

 

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Sangam, an investor advisor is considering two possible investments. Information about the investments as follows: Investment A Investment B Probability 0.30 Return (%) -2.5 Probability Return (%) 0.35 -2.5 0.30 9 0.35 9 0.40 12 0.30 12 a) Define expected return and variance. b) Calculate the following for both companies: i. Expected return ii. Variance and standard deviation iii. Coefficient of variation c) Which investment should Sangam choose? Sangam, an investor advisor is considering two possible investments. Information about the investments as follows: Investment A Investment B Probability 0.30 Return (%) -2.5 Probability Return (%) 0.35 -2.5 0.30 9 0.35 9 0.40 12 0.30 12 a) Define expected return and variance. b) Calculate the following for both companies: i. Expected return ii. Variance and standard deviation iii. Coefficient of variation c) Which investment should Sangam choose?

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a Definitions Expected Return The expected return is the average or mean return that an investor can ... View the full answer