Investment A pays $1,200 half of the time and $800 half of the time.Investment B pays $1,400 half of the time and $600 half of the time.Which of the following statements is correct?
A) Investment A and B have the same expected value, but A has greater risk.
B) Investment B has a higher expected value than A, but also greater risk.
C) Investment A and B have the same expected value, but A has lower risk than B.
D) Investment A has a greater expected value than B, but B has less risk.
Correct Answer:
Verified
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