The graph to the right shows the distribution of outcomes for two investment opportunities; Opportunity A in red and Opportunity B in blue. Which opportunity has the lowest risk? Which has the highest expected payoff? OA. B has the lowest risk and highest expected payoff. O B. B has the lowest risk, but A has the highest expected payoff. OC. A has the lowest risk and highest expected payoff. O D. B has the lowest risk, and both have the same expected payoff. O E. A has the lowest risk, and both have the same expected payoff. OF. A has the lowest risk, but B has the highest expected payoff. Probability 500 1000 Payoff ($) Opportunity B Opportunity A 1500 2000

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The graph to the right shows the distribution of outcomes for two investment
opportunities; Opportunity A in red and Opportunity B in blue.
Which opportunity has the lowest risk? Which has the highest expected payoff?
O A. B has the lowest risk and highest expected payoff.
OB. B has the lowest risk, but A has the highest expected payoff.
OC. A has the lowest risk and highest expected payoff.
O D. B has the lowest risk, and both have the same expected payoff.
O E. A has the lowest risk, and both have the same expected payoff.
OF. A has the lowest risk, but B has the highest expected payoff.
Probability
500
1000
Payoff ($)
Opportunity B
Opportunity A
1500
2000
Transcribed Image Text:The graph to the right shows the distribution of outcomes for two investment opportunities; Opportunity A in red and Opportunity B in blue. Which opportunity has the lowest risk? Which has the highest expected payoff? O A. B has the lowest risk and highest expected payoff. OB. B has the lowest risk, but A has the highest expected payoff. OC. A has the lowest risk and highest expected payoff. O D. B has the lowest risk, and both have the same expected payoff. O E. A has the lowest risk, and both have the same expected payoff. OF. A has the lowest risk, but B has the highest expected payoff. Probability 500 1000 Payoff ($) Opportunity B Opportunity A 1500 2000
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