In the future project A is expected to have a return of 17%, and project B is

expected to have a return of15%.? In the future project A is expected to have a return of 17%, and project B is expected to have a return of15%. The standard deviation for project A is expected to be 12% and standard deviation for project B is expected to be 8%.


a) Based on the standard deviation only, which project is more risky?

b) Based on coefficient of variation only, which project is more risky?

c) Which is a better measure; the standard deviation or coefficient of variation, given that the
Expected returns of the two projects are different?