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Consider These Two Investment Strategies Strategy __________ Is the Dominant Strategy Because __________

Question 26

Multiple Choice

Consider these two investment strategies:  Strategy1% Strategy2% Expected return 69 Standard deviation 04Highest return 615 Lowest return 66\begin{array}{cc}& \text { Strategy1\%} &\text { Strategy2\%} \\ \text { Expected return } &6&9\\ \text { Standard deviation } &0&4\\ \text {Highest return } &6&15\\ \text { Lowest return } &6&6\\\end{array}
Strategy __________ is the dominant strategy because __________.


A) 1; it is riskless
B) 1; it has the highest reward/risk ratio
C) 2; its return is greater than or equal to the return of Strategy 1
D) 2; it has the highest reward/risk ratio
E) Both strategies are equally preferred.

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