Reference no: EM132951619

Suppose you could make an investment. With Investment 1, there is a 20% chance of making $10, a 15% chance of making $20, a 20% chance of making $25, a 20% chance of making $30, a 20% chance of making $40, and a 5% chance of making $100. For Investment 2, there is a 25% chance of making $1,000, a 50% chance of making $2,000, and a 25% chance of making $7,500. Use the coefficient of variation to evaluate the risk involved in these two investments. How does this result differ from using the range? How does it differ from comparing the two using only the standard deviation? Why is this important?