Problem 20-12 Portfolio consideration and risk aversion [LO20-4] General Meters is considering two mergers. The first is with Firm A in its own volatile industry, the auto speedometer industry, while the second is a merger with Firm B in an industry that moves in the opposite direction (and will tend to level out performance due to negative correlation). General Meters Merger with Firm A General Meters Merger with Firm B Possible Earnings ($ in millions) Probability Possible Earnings ($ in millions) Probability $ 10 .20 $ 10 .15 20 .20 20 .30 30 .60 30 .55 a. Compute the mean, standard deviation, and coefficient of variation for both investments. (Do not round intermediate calculations. Enter your answers in millions. Round "Coefficient of variation" to 3 decimal places and "Standard deviation" to 2 decimal places.) b. Assuming investors are risk-averse, which alternative can be expected to bring the higher valuation? Merger A Merger B