Given Investments a and B with the Following Risk Return

question 17

Multiple Choice

Given investments A and B with the following risk return characteristics, which one would you prefer and why?

• A) Investment A because it has the highest expected return.
• B) Investment A because it has the lowest relative risk.
• C) Investment B because it has the lowest absolute risk.
• D) Investment B because it has the lowest coefficient of variation.
• E) Investment A because it has the highest coefficient of variation.

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Definitions:

Self-Concept

An individual's perception of themselves, including beliefs about one’s attributes, roles, goals, and competencies.

Incongruence

A state of being where there is a discrepancy between one's self-image and the reality of one’s experiences or behaviors, often leading to psychological distress.

Actual Experience

Real, lived events and interactions that an individual undergoes, as opposed to theoretical knowledge or speculative scenarios.

Abraham Maslow

A psychologist known for developing the hierarchy of needs, a theory that describes human motivation based on fulfilling a series of needs from basic to self-actualization.