Here are data on five mutual funds:

What is the reward-to-variability ratio and the ranking if the risk-free rate is 3%? Now assume that the zero-Beta form of the CAPM is appropriate. What is the differential return for the funds if Rz= 4%?

\begin{tabular}{cccc} \hline Fund & Return & Std. Deviation & Beta \\ \hline A & 14 & 6 & 1.5 \\ B & 12 & 4 & 0.5 \\ C & 16 & 8 & 1.0 \\ D & 10 & 6 & 0.5 \\ E & 20 & 10 & 2.0 \\ \hline \end{tabular}