If the Land Owner Is Risk Averse He Would Choose

question 4

Multiple Choice

If the land owner is risk averse he would choose the action with the lowest Coefficient of Variation (CV) . Which of the following is true?

• A) The CV is lower for building townhouses and condominiums.
• B) The CV is lower for building an active retirement community.
• C) Even if the land owner is risk averse, the CV leads to the same choice as the expected value approach.
• D) The CV is higher for building townhouses and condominiums, and even if the land owner is risk averse, the CV leads to the same choice as the expected value approach.
• E) The CV is lower for building an active retirement community, and even if the land owner is risk averse, the CV leads to the same choice as the expected value approach.

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Definitions:

Heart Rate Monitor

A device that measures and displays the number of heartbeats per unit of time, used to monitor heart activity during exercise or daily activities.

Opportunity Cost

The cost of the next best alternative that is forgone when making a decision.

Scenario 1-5

A series of hypothetical or planned situations used for strategic planning, decision making, or analysis, labeled numerically for differentiation.

Working

Engaging in a physical or mental activity to achieve an objective, often to earn an income.