Mountain ski corp. was set up to take large risks and is willing to take the greatest risk possible. lakeway train co. is more typical of the average corporation and is risk-averse.

projects returns: expected value standard deviation
a $ 278,000 $ 175,000
b 724,000 483,000
c 106,000 105,000
d 137,000 302,000

(a) compute the coefficients of variation. (round your answers to 3 decimal places.)
(b) which of the following four projects should mountain ski corp. choose?
(c) which one of the four projects should lakeway train co. choose based on the same criteria of using the coefficient of variation?

How long have u been on dis website

Security a has a higher standard deviation of returns than security b. we would expect that: (i) security a would have a risk premium equal to security b. (ii) the likely range of returns for security a in any given year would be higher than the likely range of returns for security b. (iii) the sharpe ratio of a will be higher than the sharpe ratio of b. (a) i only (b) i and ii only (c) ii and iii only (d) i, ii and iii

You are working on a bid to build two city parks a year for the next three years. this project requires the purchase of $249,000 of equipment that will be depreciated using straight-line depreciation to a zero book value over the three-year project life. ignore bonus depreciation. the equipment can be sold at the end of the project for $115,000. you will also need $18.000 in net working capital for the duration of the project. the fixed costs will be $37000 a year and the variable costs will be $148,000 per park. your required rate of return is 14 percent and your tax rate is 21 percent. what is the minimal amount you should bid per park? (round your answer to the nearest $100) (a) $214,300 (b) $214,100 (c) $212,500 (d) $208,200 (e) $208,400