Rank the Following Three Stocks by Their Risk-Return Relationship, Best

question 61

Multiple Choice

Rank the following three stocks by their risk-return relationship, best to worst. Rail Haul has an average return of 10 percent and standard deviation of 19 percent. The average return and standard deviation of Idol Staff are 12 percent and 22 percent; and of Poker-R-Us are 11 percent and 25 percent.

• A) Idol Staff, Rail Haul, Poker-R-Us
• B) Rail Haul, Idol Staff, Poker-R-Us
• C) Idol Staff, Poker-R-Us, Rail Haul
• D) Poker-R-Us, Rail Haul, Idol Staff

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Definitions:

Medium of Exchange

An instrument used to facilitate the sale, purchase, or trade of goods between parties, commonly accepted in the form of currency.