Concept explainers
To find: The contrast and comparison of two investments having same expected values and different standard deviations.
Answer to Problem 24HP
The contrast and comparison of two investments having same expected values and different standard deviations are discussed.
Explanation of Solution
If the two investments have same expected values then it means same amount of money on each investment is earned. But when the standard deviation is different which means that the risk is there. Those investments having the higher value have high amount of risk. The higher risk investment has more chances of profit and loss as well.
Thus, the contrast and comparison of two investments having same expected values and different standard deviations are discussed are discussed.
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