The standard deviation is generally more useful than the variance because:
A) it is easier to calculate.
B) variance is a measure of risk, where standard deviation is a measure of return.
C) standard deviation is calculated in the same units as payoffs and variance isn't.
D) it can measure unquantifiable risk.

Question

Quizplus · Accepted Answer

Standard deviation is calculated in the same units as payoffs and thus is more useful in interpreting and comparing data. Variance is calculated in squared units, which can make it difficult to interpret and compare with other data.

The Standard Deviation Is Generally More Useful Than the Variance