Possible outcomes for three investment alternatives and their probabilities of occurrence are given next. Failure Acceptable Successful Alternative 1 Alternative 2 Alternative 3 Outcomes Probability Outcomes Probability Outcomes Probability 40 0.10 90 0.20 75 0.40 110 0.60 0.40 255 0.20 0.20 Alternative 1 Alternative 2 Alternative 3 65 100 Coefficient of Variation Using the coefficient of variation, rank the three alternatives in terms of risk from lowest to highest. Note: Do not round intermediate calculations. Round your answers to 3 decimal places. 0.40 0.50 Rank 375 415

Essentials of Business Analytics (MindTap Course List)
2nd Edition
ISBN:9781305627734
Author:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson
Publisher:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson
Chapter15: Decision Analysis
Section: Chapter Questions
Problem 16P: Suppose that you are given a decision situation with three possible states of nature: s1, s2, and...
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Possible outcomes for three investment
alternatives and their probabilities of occurrence
are given next.
Failure
Acceptable
Successful
Alternative 1
Alternative 2
Alternative 3
Outcomes Probability Outcomes Probability Outcomes Probability
40
0.10
90
0.20
75
0.40
65
0.40
0.60
0.40
100
0.50
0.20
0.20
Alternative 1
Alternative 2
Alternative 3
Using the coefficient of variation, rank the three
alternatives in terms of risk from lowest to highest.
Note: Do not round intermediate calculations.
Round your answers to 3 decimal places.
Coefficient of
Variation
110
255
Rank
375
415
Transcribed Image Text:Possible outcomes for three investment alternatives and their probabilities of occurrence are given next. Failure Acceptable Successful Alternative 1 Alternative 2 Alternative 3 Outcomes Probability Outcomes Probability Outcomes Probability 40 0.10 90 0.20 75 0.40 65 0.40 0.60 0.40 100 0.50 0.20 0.20 Alternative 1 Alternative 2 Alternative 3 Using the coefficient of variation, rank the three alternatives in terms of risk from lowest to highest. Note: Do not round intermediate calculations. Round your answers to 3 decimal places. Coefficient of Variation 110 255 Rank 375 415
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